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Ford to equip EVs with built-in connector of Tesla Supercharger from 2025 onward

Ford Motor announced that its EV customers will be able to charge with Tesla Superchargers in the US and Canada next year. Moreover, Ford plans to integrate the connector of the supercharger into its EV design starting in 2025......»»

Category: topSource: digitimesMay 26th, 2023

Tesla adds General Motors to growing list of companies that will use its Superchargers

Ford was the first to join Tesla's Supercharger network in May. Elon Musk said it would bring the two automakers onto "equal footing" in the EV race. A woman gets into her Tesla electric car at a supercharger station in Los AngelesLucy Nicholson/Reuters GM cars will be able to use Tesla's Supercharger network. Ford and Tesla announced a similar partnership announcement in May.  Lack of charging access is one of the biggest hurdles to EV adoption right now.  General Motors vehicles will soon be able to charge at a large swath of Tesla's vast Supercharger network starting in 2024, the two companies announced Thursday. GM vehicles will have access to 12,000 Superchargers next year, the company said, with the automaker adopting the North American Charging Standard (NACS) in 2025. It effectively doubles the number of chargers GM drivers have access to, CEO Mary Barra said. It's part of a growing cooperation between Elon Musk and legacy automakers that will help bring them all to  "equal footing" when it comes to charging, easily one of the biggest hurdles to mass EV adoption in the United States. Having most, if not all, automakers on one charging standard — with a universal connector — could be huge for driving sales. "Consumers won't have to worry about what plug, what socket, which charging station," Tesla CEO Elon Musk said. "This is a huge advancement for electric vehicles in North America." Tesla announced a similar partnership with Ford in May. Tesla has also opened parts of its European charging network to other cars. Tesla has more than 20,700 Supercharger plugs in North America, according to the Department of Energy, making it easily the largest charging network. While other stations struggle to keep chargers working and online, Tesla's are known for reliability — and the huge network is a massive selling point for its cars. Shares of GM jumped nearly 4% in late trading Thursday following the announcement.  Read the original article on Business Insider.....»»

Category: topSource: businessinsider7 hr. 53 min. ago

Ford EVs to gain access to Tesla Superchargers with adapter; will be standard feature for BlueOval EVs

Ford announced that its electric vehicles will soon be able to access Tesla Superchargers with an adapter, doubling the number of high-speed chargers Ford EVs will have access to. The T3's coming out of BlueOval City in 2025 will have the connector built-in......»»

Category: topSource: bizjournalsMay 25th, 2023

Johnson Controls (JCI) to Decarbonize Hamburg Heating Network

As part of a collaboration, Johnson Controls (JCI) is set to provide environmentally friendly heat to thousands of residences in Hamburg through the installation of four large-scale, 15 MW heat pumps. Johnson Controls International JCI is set to supply four large-scale climate-friendly heat pumps to the city of Hamburg as part of a collaboration with HAMBURG WASSER (Hamburg Water) and Hamburg Energiewerke (Hamburg Energy), aimed at decarbonizing the district’s heating network.As part of the agreement, JCI will equip Hamburg's central wastewater treatment plant’s Dradenau site with a new heat pump system to save around 66,000 tons of carbon dioxide annually. The new heat pumps from the plant will supply Hamburg with fossil-free heat from 2025 onward.As part of the agreement, Johnson Controls will provide environmentally friendly heat to more than 39,000 residential units in Hamburg through the installation of four large-scale, 15 MW heat pumps. These pumps will extract heat from treated wastewater that leaves the plant each day and feed it into the central district heating system of Hamburg Energie, thus avoiding the usage of fossil-based heating. JCI will supply the heat pumps from its state-of-the-art facility in Nantes, France.Johnson Controls International plc Price Johnson Controls International plc price | Johnson Controls International plc QuoteJohnson Controls has more than 50 years of experience in the heat pump field. Being the first to market with eco-friendly heat pumps in 1982, the company now offers an extensive portfolio of technology and refrigerants in Europe.Zacks Rank & Key PicksJohnson Controls carries a Zacks Rank #3 (Hold).Some better-ranked stocks within the broader Industrial Products sector are as follows:ABB Ltd ABB presently carries a Zacks Rank #2 (Buy). The company pulled off a trailing four-quarter earnings surprise of 8%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks.ABB has an estimated earnings growth rate of 26.5% for the current year. The stock has rallied 21.4% in the year-to-date period.Allegion plc ALLE presently carries a Zacks Rank #2. The company delivered a trailing four-quarter earnings surprise of 12.5%, on average.Allegion has an estimated earnings growth rate of 16.3% for the current year. The stock has gained 3.6% in the year-to-date period. Zacks Reveals ChatGPT "Sleeper" Stock One little-known company is at the heart of an especially brilliant Artificial Intelligence sector. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion. As a service to readers, Zacks is providing a bonus report that names and explains this explosive growth stock and 4 other "must buys." Plus more.Download Free ChatGPT Stock Report Right Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Johnson Controls International plc (JCI): Free Stock Analysis Report ABB Ltd (ABB): Free Stock Analysis Report Allegion PLC (ALLE): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research.....»»

Category: topSource: zacksMay 18th, 2023

This Was Another Big Week For Central Bank Digital Currencies (CBDCs)

This Was Another Big Week For Central Bank Digital Currencies (CBDCs) Authored by Nick Corbishley via NakedCapitalism.com, Another G-7 economy took a big step toward adopting a central bank digital currency (CBDC). At the same time, the first largish economy to have launched a CBDC, Nigeria, descends further into financial chaos. This week, two big things happened in the CBDC arena. One of the world’s oldest central banks, the Bank of England, and the British government jointly confirmed that a digital pound would probably be necessary at some point in the none-too-distant future. While they were saying that, lengthy queues were forming at ATMs across Nigeria, the first largish economy to launch a central bank digital currency (CBDC), as most Nigerians struggle to access physical money following the government’s disastrous demonetisation campaign. “A New and Trusted Way to Pay”? Let’s begin with the UK, whose latest Chancellor of the Exchequer Jeremy Hunt this week described CBDCs as potentially “a new and trusted (state-backed) way to pay” that is likely to emerge some time this decade. John Cunliffe, Deputy Governor for Financial Stability of the Bank of England (not to be confused with the creator of the children’s books and animated TV series, Postman Pat) said: Our assessment is that on current trends it is likely that a retail, general purpose digital central bank currency — a digital pound — will be needed in the UK. With cash usage in rapid decline in the UK, a digital pound would perform the “anchor function” which cash currently carries, allowing the holder access to Bank of England money, Cunliffe said. It would also counter the risks posed by so-called “stable coins”, which are relatively new forms of cryptocurrency that are pegged to the value of a fiat currency (e.g, the dollar or the euro), while also ensuring that certain tech firms are not able to monopolize areas of the online market with their own coins. These are all classic justifications for launching a CBDC. But not everyone in the UK’s political establishment agrees that they constitute sufficient cause. For example, the former governor of the Bank of England, Mervyn King said in January, 2022: “By far the most important question is what is the problem to which a CBDC is the solution?” King said a number had been proposed but “none of them were terribly convincing”. Also, the House of Lords’ Economic Affairs Committee recently concluded that it is “yet to hear a convincing case” for why the UK needs a retail CBDC. On the contrary, while a CBDC “may provide some advantages”, it could present “significant challenges” for financial stability and the protection of privacy. But the Bank of England and the UK Treasury respectfully beg to differ. “A digital pound would be a very substantial financial infrastructure project that would take several years to complete,” Cunliffe said in a speech to UK Finance, a trade association representing over 300 firms in the UK’s banking and financial services sector. “It would, as many in this audience know, have major implications for the way we transact with each other and, more broadly, for the financial sector and the economy in general.” An Extra Layer of Operations One major implication is the impact it could have on the current banking system. As the UK-based economist Richard Werner and author of the critically acclaimed book, Princes of the Yen, has noted, if central banks were to offer retail CBDCs directly to individuals and businesses, meaning they would all be able to hold the equivalent of a current account at the central bank (as long as they have a smart phone and don’t engage in the wrong sorts of behavior), it would more or less mean the end of banking as we know it: “All you would need is a shock or a crisis. All the money would move from the bank deposits to the central bank and the banking system shuts down.” This would lead to the creation of what Werner calls “mono-banking,” in which just one lender, the central bank, is able to operate. To avoid this outcome, the BoE is considering imposing a limit on the holdings of the new digital pound of £10,000 to £20,000 ($12,017 to $24,033) once it comes into existence. The digital pound would also not bear interest. The last thing the world’s central banks want to do is wipe out large private banks, whose interests they tend to serve above all else. In fact, central banks are working hand-in-glove with many TBTF lenders to set up the CBDC infrastructure. Instead, what the BoE and many other central banks are talking about doing is creating an extra layer of operations within the financial system. And while the BoE (with help from the private sector) will create the currency, private banks will be the main public interface for that new layer, as Cunliffe himself posited in a panel discussion last June: We will produce the asset and the rails but the interface with the public would actually be done by private-sector payment providers. It could be banks that will have the customer accounts payable to integrate money into their digital applications… There are other models. One model is we allow the private sector to do the tokenization, to provide their own money that we back one-for-one with central bank money. So, CBDCs will probably not be used to supplant the entire private banking system, as some feared. But what they could — and probably will — end up doing is put out of business small, local banks and credit unions, which will not be able to cope with the added layers of regulatory costs, burdens and complexities. In the US, the National Association of Federally-Insured Credit Unions (NAFCU) warned last year that the issuance of a digital dollar could erode financial stability, arguing that the costs and risks associated with introducing a CBDC are likely to outweigh the touted benefits. Other Implications of a CBDC So, what other ramifications could a CBDC have for households and businesses? At the risk of repeating myself, here is a brief recap of some of the most important ones (please feel free to add more), taken from my previous post, Unbeknown to Most, A Financial Revolution Is Coming That Threatens to Change Everything (And Not for the Better). CBDCs will grant central banks far more power over our payment behavior. As Agustin Carstens, general manager of the Bank of International Settlements, the central bank of central banks, famously admitted at a 2020 summit of the IMF: We don’t know who’s using a $100 bill today and we don’t know who’s using a 1,000 peso bill today. The key difference with the CBDC is the central bank will have absolute control [over] the rules and regulations that will determine the use of that expression of central bank liability, and also we will have the technology to enforce that. Given the key role central bank policy has played in exacerbating wealth and income disparities in recent decades, the idea of central banks grabbing even more power should give serious pause. Indeed, one of the major risks highlighted by the House of Lords’ Economic Committee’s report on CBDCs is that it would grant central banks “greater power without sufficient scrutiny”. Central banks will be able to “program” our spending. In June 2021, the Daily Telegraph reported (behind paywall) that the Bank of England had asked Government ministers to decide whether a central bank digital currency should be “programmable”. As the article noted, “digital cash could be programmed to ensure it is only spent on essentials, or goods which an employer or Government deems to be sensible.” Tax evasion, money laundering, terrorist financing and other unapproved transaction would also become more difficult. Fines could be levied in real time. As NS Lyons, a Washington DC-based political analyst and blogger, notes in his article, Just Say No to CBDCs, “a CBDC would allow government to operate at much higher resolution. Targeted microfinance grants, added straight to the accounts of those people and businesses considered especially deserving, would be a relatively simple proposition. By the same token, Lyons warns, CBDCs could be used to significantly curtail public choice. In a cashless CBDC-dominated world, less socially or politically desirable people or organizations could even be denied access to the financial system — something we already saw happen with the Freedom Convoy in Canada: “The most dangerous individuals or organizations could simply have their digital assets temporarily deleted or their accounts’ ability to transact frozen with the push of a button, locking them out of the commercial system and greatly mitigating the threat they pose. No use of emergency powers or compulsion of intermediary financial institutions would be required: the United States has no constitutional right enshrining the freedom to transact.” Other potential forms of programming applications include setting expiry dates for stimulus funds or welfare payments to encourage users to spend it quickly. No limit on negative interest rates. Beyond providing central banks with greater control over people’s spending habits, CBDCs would also grant them the possibility of taking interest rates into far deeper negative territory. If there is no cash, there is no means for people to escape negative rates no matter how negative they go. This is one of the benefits often lauded by Harvard economist Kenneth Rogoff of a completely cashless society. Yet central banks continue to insist that physical cash will not be eliminated once the CBDCs are fully operational. But as I’ve noted previously, central banks are not exactly known for keeping their word. Greater Government Surveillance of Your Personal Data. As I’ve repeatedly warned over the past year, including in my book Scanned, central bank digital currencies will almost certainly go hand in hand with digital IDs. In 2021, the FT wrote: “What CBDC research and experimentation appears to be showing is that it will be nigh on impossible to issue such currencies outside of a comprehensive national digital ID management system.” That will mean even broader and closer scrutiny of your most personal data. Given as much, it is almost certainly no coincidence that last week — just days before the BoE underscored its interest in developing a digital pound — the UK government quietly unveiled a public consultation on draft legislation for the establishment of a digital identity framework. The government is also proposing subsidising private digital ID schemes. As readers may recall, it has also signed a digital trade agreement, or DTA (yes, they do exist), with the Urkainian government that includes a commitment to collaborate on digital identity. The British government insists that any future digital ID will not be made compulsory for British citizens. But governments, like central banks, have an annoying habit of breaking promises, particularly on the important stuff. Greater System Fragility. As the House of Lords report warns, a CBDC risks creating “a centralised point of failure that would be a target for hostile nation states or criminal actors.” It would also be vulnerable to power, telecoms and IT outages, which countries are experiencing with ever great frequency. Meanwhile, the Bank of England bank and UK Treasury insist that the decision to go ahead with a CBDC has still not been taken, and won’t be until around 2025: The Taskforce’s conclusion is that we are not yet at a point where a firm decision can be made to implement a digital pound. And if you believe that, I’ve got a digital bridge to sell you. As the BoE itself notes, the process of building the infrastructure for a digital pound will be painstaking, and will probably take a number years. Yet we are to believe that it won’t be until the infrastructure has actually been built that the decision will be made as to whether to use it. It’s a bit like sending troops halfway across the world to the border of a country you are thinking of invading, such as, say Iraq, but putting off the decision as to whether to actually invade until the very moment that all the troops are amassed. Creating a Global Monetary Laboratory “CBDCs could equip central banks with new tools to significantly help soften the impact of forthcoming financial crises, given they would provide a real-time view of risks and currency outflows,” Martin Hargreaves, chief product officer at blockchain firm Quant, told Bloomberg. Martin Hargreaves is also a member of the steering committee of the Digital Pound Foundation, which describes itself on its website as an “independent organisation whose mission is to work with a variety of stakeholders and participants towards the implementation of a well-designed digital Pound and an effective and diverse ecosystem for new forms of digital money.” The organization was incorporated less than two years ago, on June 22, 2021. On its home page, the foundation’s chairman, Jeremy Warner, says the following in a short video: The world has become a global laboratory, trying to understand the ramifications of this fast growing phenomenon. Governments and private enterprises are developing something that will serve humankind better than any past or current forms of money. This new form of money is only possible because technology is transforming all the interactions between human beings, which themselves need money, and money must therefore adapt to serve those interactions. The ramifications of this will affect every one of us. It is unlikely that we will see a global version of this form of money until we have a form of global government so nation states, regional governments and private enterprises are also working on their own versions. So, unbeknown to most people, we are living in a global monetary laboratory. We are being steered through a financial experiment that threatens to change just about everything (and for most of us, not for the better). According to the Atlantic Council’s CBDC tracker, 114 countries, representing over 95 percent of global GDP, are exploring a CBDC. That’s up from 35 countries in May 2020. Eighteen of the G20 countries are now in the advanced stage of development. Of those, 7 countries, including China and India, the world’s two most populous nations, are already in pilot. Eleven countries have fully launched a digital currency, with the latest being Jamaica, and China’s pilot is set to expand to most of the country in 2023. A Warning from Nigeria But only one largish economy has actually fully launched a CBDC, and that is Nigeria. And the results have so far been disastrous. The eNaira has so far been a total flop, as I reported for NC in July and November last year. One year after its launch, in October 2021, fewer than 0.5% of the population had downloaded an eNaira wallet — a thoroughly underwhelming number in a country with an estimated population of 225 million people. Worse still, only 282,600 of those accounts were currently active. Meanwhile, interest in cryptocurrencies has surged. To try to salvage its monetary experiment and essentially force people to use digital means of payment, preferably the so-called “eNaira”, Nigeria’s government launched an all-out assault on cash in December. Taking a leaf out of India’s book, the government began issuing redesigned high value notes from mid-December and gave residents until the end of January to turn in their old notes. When it became clear that the banking system wasn’t even close to ready to disburse the new notes, the deadline was extended to Feb 10 (i.e., today). According to the Nigerian Central Bank and government, the demonetisation campaign is intended to mop up excess cash liquidity, stay ahead of counterfeiters and take greater control of Nigeria’s money in circulation, more than 85% of which is currently outside the vaults of the country’s banking system. But another key goal is to salvage Nigeria’s floundering central bank digital currency, the eNaira. And the result has been total chaos. In a country that was already grappling with a currency crisis, soaring inflation and fuel shortages (despite being Africa’s largest oil producer) and whose sovereign rating was recently downgraded even deeper into junk territory, there is now an acute shortage of money. As in India, the result has endless lines at ATMs. Commuters in the capital and beyond have been left stranded with no cash to pay for transportation back home. Many small businesses, which represent the lion’s share of the economy, and predominantly rely on cash payments, have had to shut down as their customers have no money to pay. Astonishingly, as the central bank has withdrawn the old notes from circulation, Nigeria’s mint has not come even close to replenishing the money supply with new notes. In fact, the central bank does not even know how much new currency is being printed. When grilled by members of the House of Representatives during a plenary session, Aishah Ahmad, the deputy governor of CBN, admitted she had no idea “how much was printed of the new naira notes”. This is a monetary experiment going very badly wrong in real time, and one which other central banks will presumably be learning from. But even as Nigerians’ lives and businesses have been plunged into chaos, the government and central bank see it as a small price that is well worth paying. Godwin Emefiele, the CBN governor, has hailed the experiment as a success, given that 80% of the $7.2 billion previously held in private hands had been deposited with financial institutions, which he labels a success. Finance Minister Zainab Ahmed concurred, saying: “The only sore point is the pain it has caused to citizens.” Tyler Durden Sat, 02/11/2023 - 10:30.....»»

Category: blogSource: zerohedgeFeb 11th, 2023

Giant Container Ships Are Ruining Everything

Giant Container Ships Are Ruining Everything By Rachel Premack of FreightWaves I hate big boats, and so should you... In 2006, Maersk stunned the global shipping community with the introduction of Emma Maersk, a container ship that could carry nearly 15,000 twenty-foot equivalent units. (TEUs translate to about half of a standard forty-foot shipping container.)  Emma Maersk set off an “arms race” with its introduction. Ocean carriers ordered bigger and bigger ships, believing that they could reach economies of scale if they could jam all their shipments into one big boat instead of a few small ones. Today, we’ve appeared to reach peak Big Boat Era. The Emma Maersk is now wimpy next to 2022’s true megaships. The largest container ships to be delivered this year have a maximum capacity of 24,000 TEUs. (This class of ship is named — I am not making this up — the “Ever Alot.” The Evergreen shipping company, the very same that blocked the Suez Canal last year, ordered the record-breaking ship.) Each year brings a new, larger-than-ever megaship. The largest ship class of a given year has increased by 50% from 2012 to today, or nearly sixfold from 1981 to today.  We are living in the Big Boat Era. Massive container ships have helped wreak serious chaos on global trade. I spoke with four experts this week to learn how megaships are the sneaky reason for much of our ongoing shipping crisis.  Here are the three reasons I hate big boats: 1. They underpin the global shipping oligopoly. Global shipping is dominated by a few giant firms. But it wasn’t always this way. In the 1970s, there were so many ocean carriers that no single company controlled the industry. Since then, the market has consolidated into just a few large firms.  Up to 60 of the 100 largest ocean carriers have vanished from the 2000s to today, thanks to a wave of bankruptcies and acquisitions. The top 10 largest ocean carriers in 2000 commanded 51% of the market; today, they dominate 80% of it, according to a White House fact sheet. All of these companies are based outside the U.S.  Smaller ocean carriers began forming alliances with each other in order to compete with larger carriers, said Campbell University professor Sal Mercogliano. Megashippers decided to copy the strategy. Today, the largest ocean carriers are organized into three major container shipping alliances: 2M, The Alliance and Ocean Alliance. To ship something from, say, China to Los Angeles, you book space on a container ship operated by one of these alliances. Each company shares space on the container ship with other members of the alliance. But these alliances may cancel — or have “blank sailings” — if demand has slumped.  This system has been great for the carriers’ own financial performance. Some claim this consolidation and the alliance system lead to inflated rates. The Loadstar, a global logistics publication, reported on April 22 that the 2M alliance was blanking at least three Asia-North Europe sailings. New Chinese COVID lockdowns were one reason for the cancellation, but Loadstar also pointed to 2M’s desire to “halt the slide in rates” amid a slump in volume from China. More canceled sailings mean less capacity for cargo, and likely higher rates. The cost to move a container ship was steady and low for much of the 2010s, then exploded from 2020 onward. Now, rates are somewhat softening. Container ships have been steadily increasing in size since they were created in 1956. But it wasn’t until the 2000s that the Big Boat Era truly began, Mercogliano said. Ocean carriers believed they could reach economies of scale if they built giant ships. The idea was to put all of your cargo on one massive ship instead of two or three smaller ones.  Such megaships were expensive. Emma Maersk, for example, cost an estimated $145 million. But banks were happy to provide the cash, said Capt. John Konrad, CEO of maritime website gCaptain.  Konrad told FreightWaves that ocean carriers are ideal lending targets. If an ocean carrier defaults on its loan, you can simply repossess any of its ships. And, conveniently, many receive hefty subsidies or other support from the governments of the countries they’re based in. Before the financial crisis, banks were happy to provide massive loans to ocean liners to build the megaships of their dreams.  Then 2008 happened. As Mercogliano said, “The freight dried up.”  Big ocean liners were stuck with massive ships and not much to put on them. Many went bankrupt, and the ones that remained formed alliances.  “Firms started to say, ‘Well, these ships are tremendous investments and there’s too much money on the line,’” said University of Vermont professor Richard Sicotte. “‘Let’s share the capacity among different companies, who would ostensibly be our rivals.’” Through the 2010s, consolidation accelerated. Eight large carriers, including No. 6 largest ocean carrier Hanjin, either went bankrupt or were acquired by other large firms. The ‘cartel’ no one noticed? Crucially, this lack of competition didn’t bother anyone through the 2010s, when ocean rates were absurdly low and carriers were barely turning a profit (if at all). Alliances and consolidation were the only way to make the economics work. Bizarrely, companies continued to build even larger megaships, still chasing those economies of scale while sinking them further into debt.  “Because so few of them were left, they formed these alliances to stop underbidding each other,” Mercogliano said. “The U.S., EU, China, everyone signed off on the idea that these are not cartels. They are not trusts. The reason we did it is because we all benefited from it: We love cheap freight. It cost nothing to move goods across the Pacific.” That all changed in 2021, when carriers were raking in cash.  The Biden administration called these shipping companies a “cartel.” Some importers have recently claimed that ocean carriers have price gouged them and failed to fill their contracts amid sky-high ocean rates. On the other hand, FreightWaves’ own Greg Miller recently argued that competition among ocean liners increased as rates spiked.  Whether or not these carriers are price fixing is hardly something we can settle in today’s newsletter, but what we can agree on is that this consolidation — driven by the inability of individual companies to fill their own megaships — probably wouldn’t be so stark without those big darn ships. 2. They cause port congestion. The more obvious reason that big ships are helping cause our ongoing supply chain chaos is that they’re literally too big to fit into most ports. Even the Suez Canal struggled to accommodate one of these megaships, causing the crucial global conduit to be clogged for days last year.  Matt Stoller, who is the director of research at the American Economic Liberties Project, told FreightWaves these megaships are great for moving lots of cargo across oceans. The problem is once you get to your destination. Ocean carriers (and the financial institutions that bankroll them) aren’t paying for updated ports, increased dredging, new warehouses, highways and so on to accommodate these ships. That cost is getting off-loaded to the public, Stoller said.  Indeed, as Mercogliano pointed out, the Port Authority of New York and New Jersey spent a whopping $1.7 billion to raise its Bayonne Bridge to accommodate the shipping scions’ new megaships — a cost that was paid by taxpayers, not ocean carriers or shippers.   A relatively uncrowded Port of Houston. Can’t it always be like this? One complex is remarkably adept at accommodating those ships: the ports of Long Beach and Los Angeles. As a result, it claims 40% of all U.S. seaborne imports. Before the U.S. saw historic imports in 2020 and onward, this system worked well enough. But over the past year, it’s been remarkably backed up, causing unprecedented supply chain crunches as importers struggled to offload their containers and load empty ones back on to make the trip back to Asia.  If these ships were not so giant, we likely wouldn’t see this kind of congestion. Ocean carriers could bring their normal-sized ships to other ports around the U.S. Stoller pushed for more competition among ocean carriers, which would perhaps mean more diverse types of ships.  “We have a lot of ports in this country but we don’t have enough ocean carrier firms,” Stoller said. “The ocean carrier firms’ boats are too big for most ports.” 3. They’re quietly the reason for the ocean carriers’ financial struggles. By engaging in the megaships “arms race,” ocean carriers really just played themselves.  One 2016 study by business advisory firm AlixPartners pointed out “the irony of megaships.” In 2016 and 2017, global ocean carrier capacity increased by 4.5% and 5.6%, respectively. But demand only upticked by 1% to 3% those years. The panic to build bigger and bigger ships resulted in depressed rates: Ironically, says the study, the resulting overcapacity — and corresponding negative effect on profits — is in part the result of the industry’s drive in recent years to correct its chronic supply-and-demand imbalance by building these more efficient but mammoth ships. Months after that report, the No. 6 largest container shipping company went bankrupt. Hanjin, which had ordered more and more megaships before its insolvency, was in $10.5 billion of debt.  By continually flooding the market with capacity, ocean carriers drove down their own shipping rates. That left them with crushing debt and no way to pay it back. COVID and the influx of trade helped many carriers pay off their massive liabilities, but the good times will eventually run out for these companies. Praise be! The megaship’s choke hold on our oceans appears to be loosening. Brilliantly, ocean carriers seem to be reading my mind and hastening the end of the Big Boat Era. Of the thousands of container ships in the pipeline for these next few years, the biggest category is ships ranging from 3,000 to 7,999 TEUs, according to a recent report from Clarkson Research.  As for deliveries scheduled or already made from this year to 2025, 53 are ships with a capacity of 17,000 TEUs or larger, compared to 230 ships with a capacity of 12,000 to 16,999 TEUs.  The Big Boat Era may finally be going away. Perhaps I shouldn’t speak so soon. One 2016 article in the Financial Times, covering a Drewry Shipping Consultants study, claimed that if ships reached 24,000 TEUs, the costs of running such a ship would overtake the profit made from being able to hold so many containers. That would mean losses for the ocean carrier. And yet, dear reader, shipping magnates have gone ahead with the 24,000-TEU ships: At least a dozen may be sailing as you read this. (Or perhaps, they’re waiting outside of the Port of Long Beach to be unloaded.)  Tyler Durden Fri, 05/20/2022 - 17:03.....»»

Category: dealsSource: nytMay 20th, 2022

Tesla’s Free Cash Flow Is Still Resoundingly Negative

Stanphyl Capital’s commentary for the month ended March 31, 2022, discussing their short position in Tesla Inc (NASDAQ:TSLA). We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA) which, despite a steadily sliding share of the world’s EV market and a share of the overall auto market that’s only around 1.5%, […] Stanphyl Capital’s commentary for the month ended March 31, 2022, discussing their short position in Tesla Inc (NASDAQ:TSLA). We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA) which, despite a steadily sliding share of the world’s EV market and a share of the overall auto market that’s only around 1.5%, Trevor Scott points out has a market cap roughly equal to the next 20 largest automakers combined: if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Henry Singleton Series in PDF Get the entire 4-part series on Henry Singleton in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q4 2021 hedge fund letters, conferences and more So here’s why we remain short Tesla: Tesla has no “moat” of any kind; i.e., nothing meaningfully proprietary in terms of its electric car technology (which has now been surpassed by numerous competitors), while existing automakers—unlike Tesla­—have a decades-long “experience moat” of knowing how to mass-produce, distribute and service high-quality cars consistently and profitably. Excluding working capital benefits and sunsetting emission credit sales Tesla generates negative free cash flow. Growth in sequential unit demand for Tesla’s cars is at a crawl relative to expectations. Elon Musk is a pathological liar who under the terms of his SEC settlement cannot deny having committed securities fraud. Tesla’s Q1 Deliveries Tesla’s Q1 2022 delivery number (to be reported in early April) will likely only be slightly better than Q4 2022’s 308,000, perhaps a 20,000 (or fewer) unit gain that would be a rounding error for an auto company trading at even one-tenth of Tesla’s valuation. If in any quarter GM or VW or Toyota sold 2.02 million vehicles instead of 2 million or 1.98 million, no one would pay the slightest bit of attention to the difference. Seeing as Tesla is still being valued at over seventeen GMs, it’s time to start looking at its relatively tiny numerical sequential sales growth, rather than Wall Street’s sell-side hype of “percentage off a small base.” In other words, if you want to be valued at a giant multiple of “the big boys,” you should be treated as a big boy. And yes, Tesla is somewhat capacity constrained, but so are all its competitors. Let’s see how quickly “constraint” morphs into “excess capacity” when the German and Texas factories are fully online! Meanwhile in January Tesla reported results for Q4 2021 and once again proved that it’s a truly horrible business. Although the company claimed to have generated $2.8 billion in free cash flow for the quarter, that was almost entirely created by massively increased payables & accrued liabilities, and by stock-based compensation. After adjusting for those factors (and a tiny increase in receivables), Tesla’s free cash flow was just $119 million, and that undoubtedly included several hundred million dollars of previously earned & billed emission credit sales, a revenue stream which will almost entirely disappear next year as other automakers begin selling enough electric cars of their own. Thus, despite all the sell-side and media hype, on a sustainable basis Tesla’s free cash flow is still resoundingly negative. An Energy Company And for those of you who think that Tesla is “really an energy company,” in Q4 “Tesla Energy” had revenue of $688 million (down 8.5% year-over-year and 8% sequentially) and cost of revenue of $739 million, meaning it had a negative gross margin. So if Tesla is “really an energy company,” it’s even more screwed than if it’s just a car company! Meanwhile, perhaps the biggest reason Tesla has recently been able to post marginally increasing sequential quarterly deliveries is because competitors’ production is at the lowest level in decades due to the massive chip shortage, thereby eliminating a number of “Tesla alternatives.” Yet Tesla is enjoying record production because Musk (a notorious “corner-cutter”) is apparently willing to either substitute untested, non-auto-grade chips for the more durable chips he can’t get (please see my Twitter post about this) or simply eliminate entire crucial safety systems such as back-up steering and crash-avoidance radar. Meanwhile, many Tesla bulls sincerely believe that ten years from now the company will be twice the size of Volkswagen or Toyota, thereby selling around 20 million cars a year (up from the current run-rate of around 1.3 million); in fact in March Musk himself even raised this as a possibility. To illustrate how utterly absurd this is, going from 1.3 million cars a year today to 20 million in ten years means that in addition to one million cars a year of eventual production from the new German and Texas factories, Tesla would have to add 35 more brand new 500,000 car/year factories with sold out production; i.e., a new factory nearly every single quarter for ten years! And what then? Well, then you’d have a car company approximately twice the size of Toyota (current market cap: $249 billion) or Volkswagen (current market cap: $110 billion). If that would make Tesla worth, say, $500 billion in 10 years, discounting that back at 15%/year and allowing for enough share dilution to pay for all those factories, Tesla—in that absurdly optimistic scenario—would be worth just $100/share today, down almost 93% from its current price. Another favorite hype story from Tesla bulls has been “the China market.” But based on the Chinese domestic (non-export) sales numbers we have for January and February it appears that Q1 2022 sales there barely grew (or may have even contracted)  from Q4 2021’s. And in Q4 Tesla had only around 1.5% of the overall Chinese passenger vehicle market and just 11% of the BEV market. Meanwhile,  as Tesla continues to sell its fraudulent & dangerous so-called “Full Self Driving” the head of that program just took a four-month sabbatical; the last major Tesla executive who did that (Doug Field) never returned. In a sane regulatory environment Tesla, having sold this garbage software for over five years now… …would be prosecuted for “consumer fraud,” and indeed the regulatory tide may finally be turning, as two U.S. senators continue to question its safety and in October the NHTSA appointed a harsh critic of this deadly product to advise on its regulation. (For all known Tesla deaths see here.) Are major write-downs and refunds on the way, killing the company’s slight “claimed profitability”? Stay tuned! Meanwhile, Guidehouse Insights continues to rate Tesla dead last among autonomous competitors: Another favorite Tesla hype story has been built around so-called “proprietary battery technology.” In fact though, Tesla has nothing proprietary there—it doesn’t make them, it buys them from Panasonic, CATL and LG, and it’s the biggest liar in the industry regarding the real-world range of its cars. And if new-format 4680 cells enter the market some time in 2024 (as is now expected), even if Tesla makes some of its own,  other manufacturers will gladly sell them to anyone. Build Quality Meanwhile, Tesla build quality remains awful (it ranks second-to-last in the latest Consumer Reports reliability survey) while the latest survey from British consumer organization Which? found it to be one of the least reliable cars in existence. And Tesla’s worst-rated Model Y faces current (or imminent) competition from the much better built electric Audi Q4 e-tron, BMW iX3, Mercedes EQB, Volvo XC40 Recharge, Volkswagen ID.4, Ford Mustang Mach E, Nissan Ariya, Hyundai Ioniq 5 and Kia EV6. And Tesla’s Model 3 now has terrific direct “sedan competition” from Volvo’s beautiful Polestar 2, the great new BMW i4 and the premium version of Volkswagen’s ID.3 (in Europe), plus multiple local competitors in China. And in the high-end electric car segment worldwide the Audi e-tron (substantially improved for 2022!) and Porsche Taycan outsell the Models S & X (and the newly updated Tesla models with their dated exteriors and idiotic shifters & steering wheels won’t change this), while the spectacular new Mercedes EQS, Audi e-Tron GT and Lucid Air make the Tesla Model S look like a fast Yugo, while the extremely well reviewed new BMW iX does the same to the Model X. And oh, the joke of a “pickup truck” Tesla previewed in 2019 (and still hasn’t shown in production-ready form) won’t be much of “growth engine” either, as it will enter a dogfight of a market; in fact, Ford’s terrific 2022 all-electric F-150 Lightning now has over 200,000 retail reservations (plus many more fleet reservations), GM has introduced its fantastic 2023 electric Silverado with over 110,000 reservations and Rivian’s pick-up has gotten excellent early reviews. Regarding safety, as noted earlier in this letter, Tesla continues to deceptively sell its hugely dangerous so-called “Autopilot” system, which Consumer Reports has completely eviscerated; God only knows how many more people this monstrosity unleashed on public roads will kill despite the NTSB condemning it. Elsewhere in safety, the Chinese government forced the recall of tens of thousands of Teslas for a dangerous suspension defect the company spent years trying to cover up, and now Tesla has been hit by a class-action lawsuit in the U.S. for the same defect. Tesla also knowingly sold cars that it knew were a fire hazard and did the same with solar systems, and after initially refusing to do so voluntarily, it was forced to recall a dangerously defective touchscreen. In other words, when it comes to the safety of customers and innocent bystanders, Tesla is truly one of the most vile companies on Earth. Meanwhile the massive number of lawsuits of all types against the company continues to escalate. So here is Tesla’s competition in cars... (note: these links are regularly updated) Porsche Taycan Porsche Taycan Cross Turismo Porsche Macan Electric SUV Officially Coming in 2023 Volkswagen ID.3 Volkswagen ID.4 Electric SUV Volkswagen unveils ID.6 SUV EV in China Volkswagen ID.Buzz electric van Volkswagen ID Vizzion confirmed - answer to the Tesla Model 3 VW’s Cupra brand counts on performance for Born EV Cupra, VW brand to get entry-level battery-powered cars Volkswagen unveils $7.1B commitment to boost product line-up, R&D, mfg in N. America Audi e-tron Audi e-tron Sportback Audi E-tron GT Audi Q4 e-tron Audi Q6 e-tron confirmed for 2022 launch 2022 Audi A6 e-tron set to take on Tesla Audi will expand EV lineup with electric A6 wagon Audi TT to be axed in 2023 for 'emotional', electric replacement Hyundai Ioniq 5 Hyundai Ioniq 6 Will Be a Slick-Looking EV Sedan Hyundai Kona Electric Genesis reveals their first EV on the E-GMP platform, the electric GV60 crossover Genesis Electrified GV70 Revealed With 483 Horsepower And AWD Kia Niro Electric: 239-mile range & $39,000 before subsidies Kia EV6: Charging towards the future Kia EV4 on course to grow electric SUV range Jaguar’s All-Electric i-Pace Jaguar to become all-electric brand; Land Rover to Get 6 electric models Daimler will invest more than $47B in EVs and be all-electric ready by 2030 Mercedes EQS: the first electric vehicle in the luxury class 2023 Mercedes-Benz EQS SUV Interior Unveiled With Up To Seven Seats Mercedes-Benz unveils EQE electric sedan with impressive 400-mile range Mercedes EQE SUV to rival BMW iX and Tesla Model X Mercedes EQC electric SUV available now in Europe & China Mercedes-Benz Launches the EQV, its First Fully-Electric Passenger Van Mercedes-Benz EQB Makes Its European Debut, US Sales Confirmed Mercedes-Benz unveils EQA electric SUV with 265 miles of range and ~$46,000 price Ford Mustang Mach-E Available Now Ford F-150 Lightning electric pick-up available 2022 Ford set to launch ‘mini Mustang Mach-E’ electric SUV in 2023 Ford to launch 7 EVs in Europe in big electric push Ford’s Lincoln brand to launch full slate of electric SUVs by 2026 Volvo Polestar 2 Polestar 3 will hit U.S. market in Q1 2023 Volvo XC40 Recharge Volvo C40 electric sedan to challenge Tesla Model 3, VW ID3 Polestar 3 will be an electric SUV that shares its all-new platform with next Volvo XC90 Chevrolet Bolt sedan, 259-mile range starting at $31,000 Chevrolet Bolt EUV electric crossover Cadillac All-Electric Lyriq Available Spring 2022 GMC 2022 ALL-ELECTRIC SUPERTRUCK HUMMER EV GM’s 2023 electric Silverado pickup truck GMC to launch electric Hummer SUV in 2023 GM announces electric versions of the 2023 Chevy Equinox & Blazer SUVs starting @ $30,000 GM Launches BrightDrop to Electrify the Delivery of Goods and Services BMW leads off EV offensive with iX3 BMW expands EV offerings with iX tech flagship and i4 sedan BMW i7 EV, with 600 hp, will be most powerful variant of new 7 Series flagship 2022 BMW iX1 electric SUV spied Renault-Nissan alliance plows $26B into EV blitz- will jointly launch 35 new EVs Nissan vows to hop back on EV podium with Ariya Nissan LEAF e+ with 226-mile range is available now Nissan Unveils $18 Billion Electric-Vehicle Strategy Renault upgrades Zoe electric car as competition intensifies Renault Dacia Spring Electric SUV Renault to boost low-volume Alpine brand with 3 EVs Renault's electric Megane will debut new digital cockpit Stellantis promises 'heart-of-the-market SUV' from new, 8-vehicle EV platform Chrysler to go all-EV by 2028 Alfa Romeo's First Electric Car Will Arrive in 2024 Peugeot e-208 PEUGEOT E-2008: THE ELECTRIC AND VERSATILE SUV Peugeot 308 will get full-electric version Subaru shows off its first electric vehicle, the Solterra SUV Citroen compact EV challenges VW ID3 on price Rivian R1T Is the Most Remarkable Pickup We’ve Ever Driven Maserati going fully electric by 2030 -all vehicles will offer a BEV version by 2025 Mini Cooper SE Electric Toyota’s Electric bZ4X Goes On Sale in Spring 2022 Toyota will have lineup of 30 full EVs by 2030; Lexus will be all-electric brand Honda and Sony to build, sell EVs by 2025 Opel sees electric Corsa as key EV entry 2021 Vauxhall Mokka revealed as EV with sharp looks, massive changes Skoda Enyaq iV electric SUV offers range of power, battery sizes Electric Skoda Enyaq coupe to muscle-in on Tesla Model 3 Skoda plans small EV, cheaper variants to take on French, Korean rivals Nio to launch in five more European countries after Norway BYD will launch electric SUV in Europe The Lucid Air Achieves an Estimated EPA Range of 517 Miles on a Single Charge Bentley will start output of first full EV in 2025 All-electric Rolls-Royce Spectre to launch in 2023 – firm to be EV-only by 2030 Aston Martin will build electric vehicles in UK from 2025 Meet the Canoo, a Subscription-Only EV Pod Coming in 2021 Two new electric cars from Mahindra in India; Global Tesla rival e-car soon Former Saab factory gets new life building solar-powered Sono Sion electric cars Foxconn aims for 10% of electric car platform market by 2025 And in China… How VW Group plans to dominate China's EV market VW Goes Head-to-Head With Tesla in China With New ID.4 Crozz Electric SUV Volkswagen’s ID.3 EV to be produced by JVs with SAIC, FAW in 2021 2022 VW ID.6 Revealed With Room For Seven And Two Electric Motors China-built Audi e-tron rolls off production line in Changchun Audi Q2L e-tron debuts at Auto Shanghai Audi will build Q4 e-tron in China Audi Q5 e-tron Confirmed For China Audi in cooperation company for local electric car production with FAW FAW Hongqi starts selling electric SUV with 400km range for $32,000 FAW (Hongqi) to roll out 15 electric models by 2025 BYD goes after market left open by Tesla with four cheaper models for budget-conscious buyers BYD said to launch premium NEV brand ‘Dolphin’ in 2022 Top of Form Bottom of Form Daimler & BYD launch DENZA electric vehicle for the Chinese market Geely announces premium EV brand Zeekr Geely, Mercedes-Benz launch $780 million JV to make electric smart-branded cars Mercedes styled Denza X 7-seat electric SUV to hit market Mercedes ‘makes mark’ with China-built EQC BMW, Great Wall to build new China plant for electric cars BAIC Goes Electric, & Establishes Itself as a Force in China’s New Energy Vehicle Future BAIC BJEV, Magna ready to pour RMB2 bln in all-electric PV manufacturing JV Toyota partners with BYD to build affordable $30,000 electric car Ford MUSTANG MACH-E ROLLS OFF ASSEMBLY LINE IN CHINA FOR LOCAL CUSTOMERS Lexus to launch EV in China taking on VW and Tesla GAC Aion about to start volume production of 1,000-km range AION LX GAC Toyota to ramp up annual capacity by 400,000 NEVs GAC kicks off delivery of HYCAN 007 all-electric SUV Nio – Ready For Tomorrow Nio steps up plans for mass-market brand to compete with VW, Toyota Xpeng Motors sells multiple EV models SAIC-GM to build Ultium EV platform in Wuhan Chevrolet Menlo Electric Vehicle Launched in China Buick Introduces New VELITE 6 EV with Extended Range Buick Velite 7 EV And Velite 6 PHEV Launch In China Dongfeng launches the all-electric Voyah  PSA to accelerate rollout of electrified vehicles in China SAIC, Alibaba-backed EV brand IM begins presale of first model L7 Hyundai Motor Transforming Chongqing Factory into Electric Vehicle Plant Polestar said to plan China showroom expansion to compete with Tesla Jaguar Land Rover's Chinese arm invests £800m in EV production Renault reveals series urban e-SUV K-ZE for China Renault & Brilliance detail electric van lineup for China Renault forms China electric vehicle venture with JMCG Honda plans China EV plant to expand lineup GAC Honda launches pure electric car brand ‘e:NP’ Geely launches new electric car brand 'Geometry' – will launch 10 EVs by 2025 Geely, Foxconn form partnership to build cars for other automakers Fiat Chrysler, Foxconn Team Up for Electric Vehicles Baidu to create an intelligent EV company with automaker Geely Leapmotor starts presale of C11 electric SUV on Jan. 1 2021 Changan forms subsidiary Avatar Technology to develop smart EVs with Huawei, CATL WM Motors/Weltmeister Chery Seres Enovate China's cute Ora R1 electric hatch offers a huge range for less than US$9,000 Singulato JAC Motors releases new product planning, including many NEVs Seat to make purely electric cars with JAC VW in China Iconiq Motors Hozon Aiways Skyworth Auto Youxia CHJ Automotive begins to accept orders of Leading Ideal ONE Infiniti to launch Chinese-built EV in 2022 Human Horizons Chinese smartphone giant Xiaomi to launch electric car business with $10 billion investment Lifan Technology to roll out three EV models with swappable batteries in 2021 Here’s Tesla’s competition in autonomous driving… Waymo ranked top & Tesla last in Guidehouse leaderboard on automated driving systems Tesla has a self-driving strategy other companies abandoned years ago Fiat Chrysler, Waymo expand self-driving partnership for passenger, delivery vehicles Waymo and Lyft partner to scale self-driving robotaxi service in Phoenix Jaguar and Waymo announce an electric, fully autonomous car Renault, Nissan partner with Waymo for self-driving vehicles Geely’s Zeekr, Waymo partner on autonomous ride-hailing vehicle for the U.S. market Volvo, Waymo partner to build self-driving vehicles Volvo Cars’ unsupervised autonomous driving feature Ride Pilot to debut in California Cruise and GM Team Up with Microsoft to Commercialize Self-Driving Vehicles Cadillac Super Cruise Sets the Standard for Hands-Free Highway Driving Honda Joins with Cruise and General Motors to Build New Autonomous Vehicle Honda launching Level 3 autonomous cars Volkswagen moves ahead with Autonomous Driving R&D for Mobility as a Service VW, Bosch partner to develop autonomous driving systems Volkswagen teams up with Microsoft to accelerate the development of automated driving VW taps Baidu's Apollo platform to develop self-driving cars in China Ford “Blue Cruise” ARGO AI AND FORD TO LAUNCH SELF-DRIVING VEHICLES ON LYFT NETWORK Hyundai and Kia Invest in Aurora Toyota, Denso form robotaxi partnership with Aurora Aptiv and Hyundai Motor Group complete formation of autonomous driving joint venture Amazon’s Zoox unveils electric robotaxi that can travel up to 75 mph Nvidia and Mercedes Team Up to Make Next-Gen Vehicles Daimler's heavy trucks start self-driving some of the way SoftBank, Toyota's self-driving car venture adds Mazda, Suzuki, Subaru Corp, Isuzu Daihatsu  Continental & NVIDIA Partner to Enable Production of Artificial Intelligence Self-Driving Cars Mobileye and Geely to Offer Most Robust Driver Assistance Features Mobileye Starts Testing Self-Driving Vehicles in Germany Mobileye and NIO Partner to Bring Level 4 Autonomous Vehicles to Consumers Lucid Chooses Mobileye as Partner for Autonomous Vehicle Technology Alibaba-backed AutoX unveils first driverless RoboTaxi production line in China Nissan gives Japan version of Infiniti Q50 hands-free highway driving Hyundai to start autonomous ride-sharing service in Calif. Pony.ai Receives Approval for Paid Autonomous Robotaxi Services in Beijing Baidu Apollo’s autonomous driving service is now inclusive to all the megacities in China Toyota to join Baidu's open-source self-driving platform Baidu, WM Motor announce strategic partnership for L3, L4 autonomous driving solutions Volvo will provide cars for Didi's self-driving test fleet BMW and Tencent to develop self-driving car technology together BMW, NavInfo bolster partnership in HD map service for autonomous cars in China GM Invests $300 M in Momenta to deliver self-driving technologies in China FAW Hongqi readies electric SUV offering Level 4 autonomous driving Tencent, Changan Auto Announce Autonomous-Vehicle Joint Venture Huawei teams up with BAIC BJEV, Changan, GAC to co-launch self-driving car brands GAC Aion, DiDi Autonomous Driving to co-develop driverless NEV model BYD partners with Huawei for autonomous driving Lyft, Magna in Deal to Develop Hardware, Software for Self-Driving Cars Xpeng releases autonomous features for highway driving Nuro Becomes First Driverless Car Delivery Service in California Deutsche Post to Deploy Test Fleet Of Fully Autonomous Delivery Trucks ZF autonomous EV venture names first customer Magna’s new MAX4 self-driving platform offers autonomy up to Level 4 Groupe PSA’s safe and intuitive autonomous car tested by the general public Mitsubishi Electric to Exhibit Autonomous-driving Technologies in New xAUTO Test Vehicle Apple acquires self-driving startup Drive.ai Motional to begin robotaxi testing with Hyundai Ioniq 5 in Los Angeles JD.com Delivers on Self-Driving Electric Trucks NAVYA Unveils First Fully Autonomous Taxi Fujitsu and HERE to partner on advanced mobility services and autonomous driving Great Wall’s autonomous driving arm Haomo.ai receives investment from Meituan Plus.ai, Iveco to start L4 autonomous heavy-duty truck test in Europe, China T3 Mobility, IDRIVERPLUS to pilot Robotaxi operation in Suzhou with autonomous+manual model Here’s where Tesla’s competition will get its battery cells… Panasonic (making deals with multiple automakers) LG Samsung SK Innovation Toshiba CATL BYD Volkswagen to Build Six Electric-Vehicle Battery Factories in Europe How GM's Ultium Battery Will Help It Commit to an Electric Future GM to develop lithium-metal batteries with SolidEnergy Systems Ford, SK Innovation announce EV battery joint venture BMW & Ford Invest in Solid Power to Secure All Solid-State Batteries for Future Electric Vehicles Stellantis affirms commitment to build battery factory in Italy with Mercedes, TotalEnergies Stellantis and LG to Invest Over $5 Billion CAD in Joint Venture for Li-Ion Battery Plant in Canada Stellantis and Factorial Energy to Jointly Develop Solid-State Batteries for Electric Vehicles Mercedes-Benz to build 8 battery factories in push to become electric-only automaker Toyota to build plant in N.C. capable of making up to 1.2M batteries a year Toyota Outlines Solid-State Battery Tech, $13.6 Billion Investment Nissan Announces Proprietary Solid-State Batteries Daimler joins Stellantis as partner in European battery cell venture ACC Renault signs EV battery deals with Envision, Verkor for French plants Nissan to build $1.4bn EV battery plant in UK with Chinese partner UK companies AMTE Power and Britishvolt plan $4.9 billion investment in battery plants Freyr Verkor Farasis Microvast Akasol Cenat Wanxiang Eve Energy Svolt Romeo Power ProLogium Hyundai Motor developing solid-state EV batteries Morrow Here’s Tesla’s competition in charging networks… Infrastructure Bill: $7.5 billion Towards Nationwide Network of 500,000 EV Chargers Electrify America EVgo Chargepoint Ionity Europe Shell Plans To Deploy Around 500,000 Charging Points Globally By 2025 51 U.S. electric companies commit to build nationwide EV fast charging network by end of 2023 GM to distribute up to 10 chargers to each of its dealerships starting early 2022 Circle K Owner Plans Electric-Car Charging Push in U.S., Canada 191 U.S. Porsche dealers are installing 350kw chargers ChargePoint to equip Daimler dealers with electric car chargers Ford introduces 12,000 station charging network, teams with Amazon on home installation Petro-Canada Introduces Coast-to-Coast Canadian Charging Network Volta is rolling out a free charging network E.ON and Virta launch one of the largest intelligent EV charging networks in Europe Volkswagen plans 36,000 charging points for electric cars throughout Europe Smatric has over 400 charging points in Austria Allego has hundreds of chargers in Europe PodPoint UK charging stations BP Will Invest £1 Billion In UK Charging Infrastructure Instavolt is rolling out a UK charging network Fastned building 150kw-350kw chargers in Europe Aral To Install Over 100 Ultra-Fast Chargers In Germany Deutsche Telekom launches installation of charging network for e-cars Total to build 1,000 high-powered charging points at 300 European service-stations NIO teams up with China’s State Grid to build battery charging, swapping stations BYD, Shell to build joint venture for EV charging network development in China Volkswagen-based CAMS launches supercharging stations in China Volkswagen, FAW Group, JAC Motors, Star Charge formally announce new EV charging JV BMW to Build 360,000 Charging Points in China to Juice Electric Car Sales BP, Didi Jump on Electric-Vehicle Charging Bandwagon Evie rolls out ultrafast charging network in Australia Evie Networks To Install 42 Ultra-Fast Charging Sites In Australia And here’s Tesla’s competition in storage batteries… Panasonic Samsung LG Energy Solutions BYD AES + Siemens (Fluence) GE Hitachi ABB Toshiba Saft Johnson Contols EnerSys SOLARWATT Sonnen Kyocera Generac Kokam Eaton Tesvolt Kreisel Leclanche Lockheed Martin Honeywell EOS Energy Storage ESS UET electrIQ Power Stem ENGIE Redflow Primus Power Simpliphi Power Invinity Murata Bluestorage Adara Blue Planet Aggreko Orison Moixa Powin Energy Nidec Powervault Kore Power Shanghai Electric LithiumWerks Natron Energy Energy Vault Ambri Voltstorage Cadenza Innovation Morrow Gridtential Villara Elestor Flexgen SolarEdge Q-Cells Huawei ADS-TEC Form Energy Enphase Sumitomo Electric Stryten Energy Freyr Growatt Polarium C4V Thanks, Mark Spiegel Updated on Apr 1, 2022, 11:00 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkApr 1st, 2022

Tesla Will Recouple With Reality When The Bulls Least Expect It

Stanphyl Capital’s commentary for the month ended December 31, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). Q3 2021 hedge fund letters, conferences and more Tesla’s Absurd Diluted Market Cap We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which has a completely absurd diluted market cap of almost […] Stanphyl Capital’s commentary for the month ended December 31, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get Our Activist Investing Case Study! Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below! (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Tesla's Absurd Diluted Market Cap We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which has a completely absurd diluted market cap of almost $1.2 trillion despite a steadily sliding share of the world’s EV market and a share of the overall auto market that’s only around 1.1% (yes, one POINT one percent). At some point when momentum-riding Tesla bulls (or, for that matter, bears) least expect it, TSLA will recouple with “reality,” and that’s why I continue to maintain a short position. So here’s “reality”… Tesla has no “moat” of any kind; i.e., nothing meaningfully proprietary in terms of electric car technology, while existing automakers—unlike Tesla­—have a decades-long “experience moat” of knowing how to mass-produce, distribute and service high-quality cars consistently and profitably. Excluding sunsetting emission credit sales Tesla is barely profitable. Growth in sequential unit demand for Tesla’s cars is at a crawl relative to expectations. Elon Musk is a pathological liar who under the terms of his SEC settlement cannot deny having committed securities fraud. Many Tesla bulls sincerely believe that ten years from now the company will be twice the size of Volkswagen or Toyota, thereby selling around 21 million cars a year (up from the current one million). To illustrate how utterly clueless this is, going from a million cars a year today to 21 million in ten years means Tesla would have to add a brand new 500,000 car/year factory with sold out production EVERY single quarter for ten years! To do this even in twenty years would require adding a new factory with sold out production every six months, at which point Tesla would then be approximately twice the size of Toyota (current market cap: $257 billion) or Volkswagen (current market cap: $130 billion), making a Tesla twenty times its current size worth perhaps $500 billion in twenty years. If you discount that $500 billion back by 15% a year (which is likely a much smaller return than any Tesla bull expects) for twenty years, you get a net present value for Tesla stock of approximately $30 a share, down over 97% from 2021’s closing price. That’s why when idiot Tesla bulls look at the company’s current large trailing percentage growth from its recent tiny base and extrapolate that into the future they’re being, well… idiot Tesla bulls! Q3 Deliveries In October Tesla reported Q3 deliveries of 241,000 cars, a 40,000-unit gain over Q2 that’s a rounding error for an auto company trading at even one-tenth of Tesla’s valuation. (For Q4 the gain is expected to be another 45-50,000.) If in any quarter GM or VW or Toyota sold 2.04 million vehicles instead of 2 million or 1.96 million, no one would pay the slightest bit of attention to the difference. Seeing as Tesla is now being valued at over fourteen GMs, it’s time (as noted above) to start looking at its relatively tiny numerical sequential sales growth, rather than Wall Street’s sell-side hype of “percentage off a small base.” In other words, if you want to be valued at a giant multiple of “the big boys,” you should be treated as a big boy. Perhaps the biggest reason Tesla has recently been able to post marginally increasing sequential quarterly deliveries is because competitors’ production (and thus inventories) are at the lowest level in decades due to the massive chip shortage, thereby eliminating a number of “Tesla alternatives.” Meanwhile, Tesla is enjoying record production because Musk (a notorious “corner-cutter”) is apparently willing to substitute untested, non-auto-grade chips for the more durable chips he can’t get; please see my Twitter post about this. A favorite hype story from Tesla bulls has been “the China market” and its “record” number of 73,659 Q3 deliveries there. Let’s put this in perspective: this was only around 4000 more cars than in Q1 and only around 11,000 more than in Q2—again, these are “growth” rounding errors. (Thanks to drastically slashed production from chip-starved competitors, look for around 30,000 more in Q4.) And that “record” Q3 China quarter gave it just 1.5% of the overall passenger vehicle market and just 11% of the BEV market, and it had so much excess capacity that it exported tens of thousands of cars to Europe. Remember when Musk claimed that Tesla’s Chinese domestic demand alone would need multiple factories to satisfy? Ah, the good old days! Meanwhile, Tesla remains a lousy business. In its Q3 earnings report the company claimed it made around $1.3 billion in free cash flow (defined as operating cash flow less capex). However, this number appears to be entirely due to working capital adjustments and not from the business itself. Let me explain: Tesla claimed operating cash flow of around $3.2 billion for the quarter, but this came with the benefit of accounts payable increasing by $702 million, receivables declining by $167 million and accrued liabilities up by $665 million while (detrimentally) prepaid expenses increased by $144 million. Adjusting for that massive net working capital benefit, operating cash flow was only a bit over $1.8 billion and with capex at $1.8 billion it means Tesla’s Q3 free cash flow was essentially zero, and if you deduct stock comp (a non-cash item paid through share dilution) it was around negative $500 million. Also in its Q3 report Tesla claimed it made around $1.45 billion in net income after excluding $279 million of pure-profit emission credit sales (excluded because they’ll almost entirely disappear some time next year when other automakers will have enough EVs of their own), and after adding back a $50 million Bitcoin write-down. However, that earnings number also includes what I estimate to be Tesla’s usual $300 million or so in unsustainably low warranty provisioning, and after adjusting for that and assuming no other fraudulent accounting, Tesla only earned around $1.06/share, which annualizes to $4.24. An auto industry PE multiple of 10x would thus make TSLA worth around $42/share (admittedly, more than the “$0” I once expected), while a “growth multiple” of 20x would value it at $84, which is a 92% discount to December’s closing price of around $1057. And before you tell me that a 100% premium to the industry’s PE ratio isn’t enough, keep in mind that—as noted earlier—Tesla’s sequential unit growth is an auto industry rounding error. In fact, one could argue that Tesla’s multiple should carry a discount, considering the massive legal and financial liabilities continually generated by its pathologically lying CEO. Full Self Driving Meanwhile Tesla continues to sell (and book cash flow, if not accounting revenue from) its fraudulent & dangerous so-called “Full Self Driving.” In a sane regulatory environment Tesla having done this for five years now… …would be considered “consumer fraud,” and indeed the regulatory tide may finally be turning, as in August two U.S. Senators demanded an FTC investigation and in October the NHTSA appointed a harsh critic of this deadly product to advise on its regulation. (For all known Tesla deaths see here.) Are major write-downs and refunds on the way, killing the company’s slight “claimed profitability”? Stay tuned! Meanwhile, Guidehouse Insights continues to rate Tesla dead last among autonomous competitors: Another favorite Tesla hype story has been built around so-called “proprietary battery technology.” In fact though, Tesla has nothing proprietary there—it doesn’t make them, it buys them from Panasonic, CATL and LG, and it’s the biggest liar in the industry regarding the real-world range of its cars. And if new-format 4680 cells enter the market some time in 2022 (as is now expected), even if Tesla makes some of its own, other manufacturers will gladly sell them to anyone. Tesla Build Quality Remains Awful Meanwhile, Tesla build quality remains awful (it ranks second-to-last in the latest Consumer Reports reliability survey and in the bottom 10% of the latest J.D. Power survey) and its worst-rated Model Y faces current (or imminent) competition from the much better built electric Audi Q4 e-tron, BMW iX3, Mercedes EQB, Volvo XC40 Recharge, Volkswagen ID.4, Ford Mustang Mach E, Nissan Ariya, Hyundai Ioniq 5 and Kia EV6. And Tesla’s Model 3 now has terrific direct “sedan competition” from Volvo’s beautiful Polestar 2, the great new BMW i4 and the premium version of Volkswagen’s ID.3 (in Europe), plus multiple local competitors in China. And in the high-end electric car segment worldwide the Audi e-tron (substantially improved for 2022!) and Porsche Taycan outsell the Models S & X (and the newly updated Tesla models with their dated exteriors and idiotic shifters & steering wheels won’t change this), while the spectacular new Mercedes EQS, Audi e-Tron GT and Lucid Air make the Tesla Model S look like a fast Yugo, while the extremely well reviewed new BMW iX does the same to the Model X. And oh, the joke of a “pickup truck” Tesla previewed in 2019 (and still hasn’t shown in production-ready form) won’t be much of “growth engine” either, as it will enter a dogfight of a market; in fact, Ford’s terrific 2022 all-electric F-150 Lightning now has nearly 200,000 retail reservations (plus many more fleet reservations), Rivian’s pick-up has gotten fantastic early reviews, and in January GM will introduce its electric Silverado. Regarding safety, as noted earlier in this letter, Tesla continues to deceptively sell its hugely dangerous so-called “Autopilot” system, which Consumer Reports has completely eviscerated; God only knows how many more people this monstrosity unleashed on public roads will kill despite the NTSB condemning it. Elsewhere in safety, in 2020 the Chinese government forced the recall of tens of thousands of Teslas for a dangerous suspension defect the company spent years trying to cover up, and now Tesla has been hit by a class-action lawsuit in the U.S. for the same defect. Tesla also knowingly sold cars that it knew were a fire hazard and did the same with solar systems, and after initially refusing to do so voluntarily, it was forced to recall a dangerously defective touchscreen. In other words, when it comes to the safety of customers and innocent bystanders, Tesla is truly one of the most vile companies on Earth. Meanwhile the massive number of lawsuits of all types against the company continues to escalate. So Here Is Tesla's Competition In Cars (Note: These Links Are Regularly Updated)... Porsche Taycan Porsche Taycan Cross Turismo Porsche Macan Electric SUV Officially Coming in 2023 Volkswagen ID.3 Headlines VW's Electrified Future Volkswagen ID.4 Electric SUV Volkswagen ID.Buzz electric van teased ahead of 2022 launch Volkswagen ID 6 to arrive with 435-mile range in 2023 Volkswagen Aero B: new electric Passat equivalent spied VW’s Cupra brand counts on performance for Born EV Cupra, VW brand to get entry-level battery-powered cars Audi e-tron Audi e-tron Sportback Audi E-tron GT Audi Q4 e-tron Audi Q6 e-tron confirmed for 2022 launch Audi previews long-range A6 e-tron EV Audi TT set to morph into all-electric crossover Hyundai Ioniq 5 Hyundai Ioniq 6 spotted ahead of 2022 launch Hyundai Kona Electric Genesis reveals their first EV on the E-GMP platform, the electric GV60 crossover Genesis Electrified GV70 Revealed With 483 Horsepower And AWD Kia Niro Electric: 239-mile range & $39,000 before subsidies Kia EV6: Charging towards the future Kia EV4 on course to grow electric SUV range Jaguar’s All-Electric i-Pace Jaguar to become all-electric brand; Land Rover to Get 6 electric models Daimler will invest more than $47B in EVs and be all-electric ready by 2030 Mercedes EQS: the first electric vehicle in the luxury class Mercedes EQS SUV takes shape Mercedes-Benz unveils EQE electric sedan with impressive 400-mile range Mercedes EQE SUV to rival BMW iX and Tesla Model X Mercedes EQC electric SUV available now in Europe & China Mercedes-Benz Launches the EQV, its First Fully-Electric Passenger Van Mercedes-Benz EQB Makes Its European Debut, US Sales Confirmed Mercedes-Benz unveils EQA electric SUV with 265 miles of range and ~$46,000 price Ford Mustang Mach-E Available Now Ford F-150 Lightning electric pick-up available 2022 Ford set to launch ‘mini Mustang Mach-E’ electric SUV in 2023 Ford to offer EV versions of Explorer, Aviator, ‘rugged SUVs' Volvo Polestar 2 Polestar 3 SUV Production Design Revealed. The US-built electric SUV will debut in 2022. Volvo XC40 Recharge Volvo C40 electric sedan to challenge Tesla Model 3, VW ID3 Polestar 3 will be an electric SUV that shares its all-new platform with next Volvo XC90 Chevy updates, expands Bolt EV family as price drops Cadillac All-Electric Lyriq Available Spring 2022 GMC ALL-ELECTRIC SUPERTRUCK HUMMER EV GM to build electric Silverado in Detroit with estimated range of more than 400 miles GMC to launch electric Hummer SUV in 2023 GM will offer 30 all-electric models globally by 2025 GM Launches BrightDrop to Electrify the Delivery of Goods and Services Nissan vows to hop back on EV podium with Ariya Nissan LEAF e+ with 226-mile range is available now Nissan Unveils $18 Billion Electric-Vehicle Strategy BMW leads off EV offensive with iX3 BMW expands EV offerings with iX tech flagship and i4 sedan BMW i7 Confirmed for 2022 Launch 2022 BMW iX1 electric SUV spied Rivian R1T Is the Most Remarkable Pickup We’ve Ever Driven Renault upgrades Zoe electric car as competition intensifies Renault Dacia Spring Electric SUV Renault to boost low-volume Alpine brand with 3 EVs Renault's electric Megane will debut new digital cockpit Stellantis promises 'heart-of-the-market SUV' from new, 8-vehicle EV platform Alfa Romeo is latest Stellantis brand to get all-electric future Peugeot e-208 PEUGEOT E-2008: THE ELECTRIC AND VERSATILE SUV Peugeot 308 will get full-electric version Subaru shows off its first electric vehicle, the Solterra SUV Citroen compact EV challenges VW ID3 on price Maserati to launch electric sports car Mini Cooper SE Electric Toyota’s Electric bZ4X Goes On Sale in Spring 2022 Toyota will have lineup of 30 full EVs by 2030; Lexus will be all-electric brand Opel sees electric Corsa as key EV entry 2021 Vauxhall Mokka revealed as EV with sharp looks, massive changes Skoda Enyaq iV electric SUV offers range of power, battery sizes Electric Skoda Enyaq coupe to muscle-in on Tesla Model 3 Skoda plans small EV, cheaper variants to take on French, Korean rivals Nio to launch in five more European countries after Norway BYD will launch electric SUV in Europe The Lucid Air Achieves an Estimated EPA Range of 517 Miles on a Single Charge Bentley converting to electric-only brand All-electric Rolls-Royce Spectre to launch in 2023 – firm to be EV-only by 2030 Aston Martin will build electric vehicles in UK from 2025 Meet the Canoo, a Subscription-Only EV Pod Coming in 2021 Two new electric cars from Mahindra in India; Global Tesla rival e-car soon Former Saab factory gets new life building solar-powered Sono Sion electric cars Foxconn aims for 10% of electric car platform market by 2025 And In China... How VW Group plans to dominate China's EV market VW Goes Head-to-Head With Tesla in China With New ID.4 Crozz Electric SUV Volkswagen’s ID.3 EV to be produced by JVs with SAIC, FAW in 2021 2022 VW ID.6 Revealed With Room For Seven And Two Electric Motors China-built Audi e-tron rolls off production line in Changchun Audi Q2L e-tron debuts at Auto Shanghai Audi will build Q4 e-tron in China Audi Q5 e-tron Confirmed For China Audi in cooperation company for local electric car production with FAW FAW Hongqi starts selling electric SUV with 400km range for $32,000 FAW (Hongqi) to roll out 15 electric models by 2025 BYD goes after market left open by Tesla with four cheaper models for budget-conscious buyers BYD said to launch premium NEV brand ‘Dolphin’ in 2022 Top of Form Bottom of Form Daimler & BYD launch DENZA electric vehicle for the Chinese market Geely announces premium EV brand Zeekr Geely, Mercedes-Benz launch $780 million JV to make electric smart-branded cars Mercedes styled Denza X 7-seat electric SUV to hit market Mercedes ‘makes mark’ with China-built EQC BMW, Great Wall to build new China plant for electric cars BAIC Goes Electric, & Establishes Itself as a Force in China’s New Energy Vehicle Future BAIC BJEV, Magna ready to pour RMB2 bln in all-electric PV manufacturing JV Toyota partners with BYD to build affordable $30,000 electric car Ford MUSTANG MACH-E ROLLS OFF ASSEMBLY LINE IN CHINA FOR LOCAL CUSTOMERS Lexus to launch EV in China taking on VW and Tesla GAC Aion about to start volume production of 1,000-km range AION LX GAC Toyota to ramp up annual capacity by 400,000 NEVs GAC kicks off delivery of HYCAN 007 all-electric SUV Nio – Ready For Tomorrow Nio steps up plans for mass-market brand to compete with VW, Toyota Xpeng Motors sells multiple EV models SAIC-GM to build Ultium EV platform in Wuhan Chevrolet Menlo Electric Vehicle Launched in China Buick Introduces New VELITE 6 EV with Extended Range Buick Velite 7 EV And Velite 6 PHEV Launch In China Dongfeng launches the all-electric Voyah  PSA to accelerate rollout of electrified vehicles in China SAIC, Alibaba-backed EV brand IM begins presale of first model L7 Hyundai Motor Transforming Chongqing Factory into Electric Vehicle Plant Polestar said to plan China showroom expansion to compete with Tesla Jaguar Land Rover's Chinese arm invests £800m in EV production Renault reveals series urban e-SUV K-ZE for China Renault & Brilliance detail electric van lineup for China Renault forms China electric vehicle venture with JMCG Honda to start sales of new EV-branded vehicles in China in 2022 Geely launches new electric car brand 'Geometry' – will launch 10 EVs by 2025 Geely, Foxconn form partnership to build cars for other automakers Fiat Chrysler, Foxconn Team Up for Electric Vehicles Baidu to create an intelligent EV company with automaker Geely Leapmotor starts presale of C11 electric SUV on Jan. 1 2021 Changan forms subsidiary Avatar Technology to develop smart EVs with Huawei, CATL WM Motors/Weltmeister Chery Seres Enovate China's cute Ora R1 electric hatch offers a huge range for less than US$9,000 Singulato JAC Motors releases new product planning, including many NEVs Seat to make purely electric cars with JAC VW in China Iconiq Motors Hozon Aiways Skyworth Auto Youxia CHJ Automotive begins to accept orders of Leading Ideal ONE Infiniti to launch Chinese-built EV in 2022 Human Horizons Chinese smartphone giant Xiaomi to launch electric car business with $10 billion investment Lifan Technology to roll out three EV models with swappable batteries in 2021 Here’s Tesla’s Competition In Autonomous Driving... Waymo ranked top & Tesla last in Guidehouse leaderboard on automated driving systems Tesla has a self-driving strategy other companies abandoned years ago Fiat Chrysler, Waymo expand self-driving partnership for passenger, delivery vehicles Waymo and Lyft partner to scale self-driving robotaxi service in Phoenix Volvo, Waymo partner to build self-driving vehicles Jaguar and Waymo announce an electric, fully autonomous car Renault, Nissan partner with Waymo for self-driving vehicles Geely’s Zeekr, Waymo partner on autonomous ride-hailing vehicle for the U.S. market Cruise and GM Team Up with Microsoft to Commercialize Self-Driving Vehicles Cadillac Super Cruise Sets the Standard for Hands-Free Highway Driving Honda Joins with Cruise and General Motors to Build New Autonomous Vehicle Honda launching Level 3 autonomous cars Volkswagen moves ahead with Autonomous Driving R&D for Mobility as a Service Volkswagen teams up with Microsoft to accelerate the development of automated driving VW taps Baidu's Apollo platform to develop self-driving cars in China Ford “Blue Cruise” ARGO AI AND FORD TO LAUNCH SELF-DRIVING VEHICLES ON LYFT NETWORK Hyundai and Kia Invest in Aurora Toyota, Denso form robotaxi partnership with Aurora Aptiv and Hyundai Motor Group complete formation of autonomous driving joint venture Amazon’s Zoox unveils electric robotaxi that can travel up to 75 mph Nvidia and Mercedes Team Up to Make Next-Gen Vehicles Daimler's heavy trucks start self-driving some of the way SoftBank, Toyota's self-driving car venture adds Mazda, Suzuki, Subaru Corp, Isuzu Daihatsu  Continental & NVIDIA Partner to Enable Production of Artificial Intelligence Self-Driving Cars Mobileye and Geely to Offer Most Robust Driver Assistance Features Mobileye Starts Testing Self-Driving Vehicles in Germany Mobileye and NIO Partner to Bring Level 4 Autonomous Vehicles to Consumers Lucid Chooses Mobileye as Partner for Autonomous Vehicle Technology Alibaba-backed AutoX unveils first driverless RoboTaxi production line in China Nissan gives Japan version of Infiniti Q50 hands-free highway driving Hyundai to start autonomous ride-sharing service in Calif. Pony.ai Receives Approval for Paid Autonomous Robotaxi Services in Beijing Baidu kicks off its robotaxi business, after getting the OK to charge fees in Beijing Toyota to join Baidu's open-source self-driving platform Baidu, WM Motor announce strategic partnership for L3, L4 autonomous driving solutions Volvo will provide cars for Didi's self-driving test fleet BMW and Tencent to develop self-driving car technology together BMW, NavInfo bolster partnership in HD map service for autonomous cars in China GM Invests $300 M in Momenta to deliver self-driving technologies in China FAW Hongqi readies electric SUV offering Level 4 autonomous driving Tencent, Changan Auto Announce Autonomous-Vehicle Joint Venture Huawei teams up with BAIC BJEV, Changan, GAC to co-launch self-driving car brands GAC Aion, DiDi Autonomous Driving to co-develop driverless NEV model BYD partners with Huawei for autonomous driving Lyft, Magna in Deal to Develop Hardware, Software for Self-Driving Cars Xpeng releases autonomous features for highway driving Nuro Becomes First Driverless Car Delivery Service in California Deutsche Post to Deploy Test Fleet Of Fully Autonomous Delivery Trucks ZF autonomous EV venture names first customer Magna’s new MAX4 self-driving platform offers autonomy up to Level 4 Groupe PSA’s safe and intuitive autonomous car tested by the general public Mitsubishi Electric to Exhibit Autonomous-driving Technologies in New xAUTO Test Vehicle Apple acquires self-driving startup Drive.ai Motional to begin robotaxi testing with Hyundai Ioniq 5 in Los Angeles JD.com Delivers on Self-Driving Electric Trucks NAVYA Unveils First Fully Autonomous Taxi Fujitsu and HERE to partner on advanced mobility services and autonomous driving Great Wall’s autonomous driving arm Haomo.ai receives investment from Meituan Plus.ai, Iveco to start L4 autonomous heavy-duty truck test in Europe, China T3 Mobility, IDRIVERPLUS to pilot Robotaxi operation in Suzhou with autonomous+manual model Here’s Where Tesla’s Competition Will Get Its Battery Cells... Panasonic (making deals with multiple automakers) LG Samsung SK Innovation Toshiba CATL BYD Volkswagen to Build Six Electric-Vehicle Battery Factories in Europe How GM's Ultium Battery Will Help It Commit to an Electric Future GM to develop lithium-metal batteries with SolidEnergy Systems Ford, SK Innovation announce EV battery joint venture BMW & Ford Invest in Solid Power to Secure All Solid-State Batteries for Future Electric Vehicles Stellantis, LG Energy Solution to form battery JV for N. American market Stellantis and Factorial Energy to Jointly Develop Solid-State Batteries for Electric Vehicles Toyota to build plant in N.C. capable of making up to 1.2M batteries a year Toyota Outlines Solid-State Battery Tech, $13.6 Billion Investment Nissan Announces Proprietary Solid-State Batteries Daimler joins Stellantis as partner in European battery cell venture ACC Renault signs EV battery deals with Envision, Verkor for French plants Nissan to build $1.4bn EV battery plant in UK with Chinese partner UK companies AMTE Power and Britishvolt plan $4.9 billion investment in battery plants Freyr Verkor Farasis Microvast Akasol Cenat Wanxiang Eve Energy Svolt Romeo Power ProLogium Hyundai Motor developing solid-state EV batteries Daimler Morrow Here’s Tesla’s Competition In Charging Networks... Infrastructure Bill: $7.5 billion Towards Nationwide Network of 500,000 EV Chargers Electrify America is spending $2 billion building a high-speed U.S. charging network 51 U.S. electric companies commit to build nationwide EV fast charging network by end of 2023 GM to distribute up to 10 chargers to each of its dealerships starting early 2022 General Motors and EVgo Boost Build Plan for High Power Fast Chargers Across the US Circle K Owner Plans Electric-Car Charging Push in U.S., Canada 191 U.S. Porsche dealers are installing 350kw chargers ChargePoint to equip Daimler dealers with electric car chargers GM and Bechtel plan to build thousands of electric car charging stations across the US Ford introduces 12,000 station charging network, teams with Amazon on home installation Shell Plans To Deploy Around 500,000 Charging Points Globally By 2025 Petro-Canada Introduces Coast-to-Coast Canadian Charging Network Volta is rolling out a free charging network Ionity Europe E.ON and Virta launch one of the largest intelligent EV charging networks in Europe Volkswagen plans 36,000 charging points for electric cars throughout Europe Smatric has over 400 charging points in Austria Allego has hundreds of chargers in Europe PodPoint UK charging stations BP Chargemaster/Polar is building stations across the UK Instavolt is rolling out a UK charging network Fastned building 150kw-350kw chargers in Europe Aral To Install Over 100 Ultra-Fast Chargers In Germany Deutsche Telekom launches installation of charging network for e-cars Total to build 1,000 high-powered charging points at 300 European service-stations NIO teams up with China’s State Grid to build battery charging, swapping stations Volkswagen-based CAMS launches supercharging stations in China Volkswagen, FAW Group, JAC Motors, Star Charge formally announce new EV charging JV BMW to Build 360,000 Charging Points in China to Juice Electric Car Sales BP, Didi Jump on Electric-Vehicle Charging Bandwagon Evie rolls out ultrafast charging network in Australia Evie Networks To Install 42 Ultra-Fast Charging Sites In Australia And Here’s Tesla’s Competition In Storage Batteries... Panasonic Samsung LG BYD AES + Siemens (Fluence) GE Bosch Hitachi ABB Toshiba Saft Johnson Contols EnerSys SOLARWATT Schneider Electric Sonnen Kyocera Generac Kokam NantEnergy Eaton Nissan Tesvolt Kreisel Leclanche Lockheed Martin EOS Energy Storage ESS UET electrIQ Power Belectric Stem ENGIE Redflow Renault Primus Power Simpliphi Power redT Energy Storage Murata Bluestorage Adara Blue Planet Tabuchi Electric Aggreko Orison Moixa Powin Energy Nidec Powervault Kore Power Shanghai Electric Schmid 24M Ecoult Innolith LithiumWerks Natron Energy Energy Vault Ambri Voltstorage Cadenza Innovation Morrow Gridtential Villara Elestor Thanks and Happy New Year, Mark Spiegel Updated on Jan 3, 2022, 11:25 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkJan 3rd, 2022

Escobar: Fauci As Darth Vader Of The COVID Wars

Escobar: Fauci As Darth Vader Of The COVID Wars Authored by Pepe Escobar via The Asia Times, Robert F Kennedy Jr’s The Real Anthony Fauci: Bill Gates, Big Pharma and the Global War on Democracy and Public Health should be front-page news in all the news media in the US. Instead, it has been met with the proverbial thundering silence. Critics seeking to have Kennedy dismissed as a kook trading on a famous name had scored a hit in February, when Instagram permanently deleted his account, allegedly for making false claims about coronavirus and vaccines. Nevertheless, the book, published only a few days ago, is already a certified pop hit on Amazon. RFK Jr., chairman of the board of and chief legal counsel for Children’s Health Defense, sets out to deconstruct a New Normal, encroaching upon all of us since early 2020. In my early 2021 book Raging Twenties I have termed this force techno-feudalism. Kennedy describes it as “rising totalitarianism,” complete with “mass propaganda and censorship, the orchestrated promotion of terror, the manipulation of science, the suppression of debate, the vilification of dissent and use of force to prevent protest.” Focusing on Dr Anthony Fauci as the fulcrum of the biggest story of the 21st century allows RFK Jr to paint a complex canvas of planned militarization and, especially, monetization of medicine, a toxic process managed by Big Pharma, Big Tech and the military/intel complex – and dutifully promoted by mainstream media. By now everyone knows that the big winners have been Big Finance, Big Pharma, Big Tech and Big Data, with a special niche for Silicon Valley behemoths. Why Fauci? RFK Jr. argues that for five decades, he has been essentially a Big Pharma agent, nurturing “a complex web of financial entanglements among pharmaceutical companies and the National Institute of Allergy and Infectious Diseases (NIAID) and its employees that has transformed NIAID into a seamless subsidiary of the pharmaceutical industry. Fauci unabashedly promotes his sweetheart relationship with Pharma as a ‘public-private partnership.’” Arguably the full contours of this very convoluted story have never before been examined along these lines, extensively documented and with a wealth of links. Fauci may not be a household name outside of the US and especially across the Global South. And yet it’s this global audience that should be particularly interested in his story. RFK Jr accuses Fauci of having pursued nefarious strategies since the onset of Covid-19 – from falsifying science to suppressing and sabotaging competitive products that bring lower profit margins. Kennedy’s verdict is stark: “Tony Fauci does not do public health; he is a businessman, who has used his office to enrich his pharmaceutical partners and expand the reach of influence that has made him the most powerful – and despotic – doctor in human history.” This is a very serious accusation. It’s up to readers to examine the facts of the case and decide whether Fauci is some kind of medical Dr Strangelove. No Vitamin D? Pride of place goes to the Fauci-privileged modeling that overestimated Covid deaths by 525%, cooked up by fabricator Neil Ferguson of the Imperial College in London, duly funded by the Bill and Melinda Gates Foundation. This is the model, later debunked, that justified lockdown hysteria all across the planet. Kennedy attributes to Canadian vaccine researcher Dr Jessica Rose the charge that Fauci was at the frontline of erasing the notion of natural immunity even as throughout 2020 the CDC and the World Health Organization (WHO) admitted that people with healthy immune systems bear minimal risk of dying from Covid. Dr Pierre Kory, president of Front Line Covid-19 Critical Care Alliance, was among those who denounced Fauci’s modus operandi of privileging the development of tech vaccines while allowing no space for repurposed medications effective against Covid: “It is absolutely shocking that he recommended no outpatient care, not even Vitamin D.” Clinical cardiologist Peter McCullough and his team of frontline doctors tested prophylactic protocols using, for instance, ivermectin – “we had terrific data from medical teams in Bangladesh” – and added other medications such as azithromycin, zinc, Vitamin D and IV Vitamin C. And all this while across Asia there was widespread use of saline nasal lavages. By July 1, 2020, McCullough and his team submitted their first, ground-breaking protocol to the American Journal of Medicine. It became the most-downloaded paper in the world helping doctors to treat Covid-19. McCullough complained last year that Fauci has never, to date, published anything on how to treat a Covid patient.” He additionally alleged: “Anyone who tries to publish a new treatment protocol will find themselves airtight blocked by the journals that are all under Fauci’s control.” It got much worse. McCullough: “The whole medical establishment was trying to shut down early treatment and silence all the doctors who talked about success. A whole generation of doctors just stopped practicing medicine.” (A contrarian view would argue that McCullough got carried away: A million US doctors – the approximate number practicing at any given time – could not all have been in on it.) The book argues that the reasons there was a lack of original research on how to fight Covid were the dependence of much-vaunted American academics on the billions of dollars granted by the National Institute of Health (NIH) and the fact they were terrified of contradicting Fauci. Frontline Covid specialists Kory and McCullough are quoted as charging that Fauci’s suppression of early treatment and off-patent medication was responsible for up to 80% of deaths attributed to Covid in the US. How to kill the competition The book offers a detailed outline of an alleged offensive by Big Pharma to kill hydroxychloroquine (HCQ) – with research mercenaries funded by the Gates-Fauci axis allegedly misinterpreting and misreporting negative results by employing faulty protocols. Kennedy says that Bill Gates by 2020 virtually controlled the whole WHO apparatus, as the largest funder after the US government (before Trump pulled the US out of the WHO) and used the agency to fully discredit HCQ. The book also addresses Lancetgate – when the world’s top two scientific journals, The Lancet and the New England Journal of Medicine published fraudulent studies from a nonexistent database owned by a previously unknown company. Only a few weeks later both journals – deeply embarrassed and with their hard-earned credibility challenged – withdrew the studies. There was never any explanation as to why they got involved in what could be interpreted as one of the most serious frauds in the history of scientific publishing. But it all served a purpose. For Big Pharma, says Kennedy, killing HCQ and, later, Ivermectin (IVM) were top priorities. Ivermectin happens to be a low-profit competitor to a Merck product, molnupiravir, which is essentially a copycat but capable of retailing at a profitable $700 per course. Fauci was quite excited by a promising study of Gilead’s remdesivir – which not only is not effective against Covid but is a de facto deadly poison, at $3,000 for each treatment. The book suggests that Fauci might have wanted to kill HCQ and IVM because under federal US rules, the FDA’s recognition of both HCQ and IVM would automatically kill remdesivir. The Bill and Melinda Gates Foundation happens to have a large equity stake in Gilead. A key point for Kennedy is that vaccines were Big Pharma’s Holy Grail. He details how what could be construed as a Fauci-Gates alliance put “billions of taxpayer and tax-deducted dollars into developing” an mRNA “platform for vaccines that, in theory, would allow them to quickly produce new ‘boosters’ to combat each ‘escape variant.'” Vaccines, he writes, “are one of the rare commercial products that multiply profits by failing.… The good news for Pharma was that all of humanity would be permanently dependent on biannual or even triannual booster shots.” Any similarities with our current “booster” reality are not mere coincidence. The final summary of Pfizer’s clinical trial data will raise countless eyebrows. The whole process lasted a mere six months. This is the document that Pfizer submitted to the FDA to win approval for its vaccine. It beggars belief that Pfizer won the FDA’s emergency approval despite showing that the vaccine might prevent one (italics mine) Covid death in every 22,000 vaccine recipients. Peter McCullough: “Because the clinical trial showed that vaccines reduce absolute risk less than 1 percent, those vaccines can’t possibly influence epidemic curves. It’s mathematically impossible.” The Gates matrix Bill Gates – Teflon-protected by virtually all Western mainstream media – describes the operational philosophy of his foundation as “philantrocapitalism.” It’s more like strategic self-philantropy, as both the foundation’s capital and his net worth have been ballooning in style ($23 billion just during the 2020 lockdowns). The Bill and Melinda Gates Foundation – “a nonprofit fighting poverty, disease and inequity around the world” – invests in multinational pharma, food, agriculture, energy, telecom and global tech companies. It exercises considerable de facto control over international health and agricultural agencies as well as mainstream media – as the Columbia Journalism Review showed in August 2020. Gates, without a graduate degree, not to mention medical school degree (like author Kennedy, it must be noted, whose training was as a lawyer), dispenses wisdom around the world as a health expert. The foundation holds corporate stocks and bonds in Pfizer, Merck, GSK, Novartis and Sanofi, among other giants, and substantial positions in Gilead, AstraZeneca and Moderna. The book delves in minute detail into how Gates controls the WHO (the largest direct donor: $604.2 million in 2018-2019, the latest available numbers). Already in 2011 Gates ordered: “All 183 member states, you must make vaccines a central focus of your health systems.” The next year, the World Health Assembly, which sets the WHO agenda, adopted a Global Vaccine Plan designed by – who else? – the Bill and Melinda Gates Foundation. The Foundation also controls the Strategic Advisory Group of Experts (SAGE), the top advisory group to the WHO on vaccines, as well as the crucial GAVI Alliance (formerly the Global Alliance for Vaccines and Immunization), which is the second-largest donor to the WHO. GAVI is a Gates “public-private partnership” that essentially corrals bulk sales of vaccines from Big Pharma to poor nations. British Prime Minister Boris Johnson, only three month ago, proclaimed that “GAVI is the new NATO”. GAVI’s global HQ is in Geneva. Switzerland has given Gates full diplomatic immunity. Few in East and West know that it was Gates who in 2017 handpicked the WHO’s director general Tedros Adhanom Ghebreyesus – who brought no medical degree and a quite dodgy background. Dr Vandana Shiva, India’s leading human rights activist (routinely accused of being merely anti-vax), sums up: “Gates has hijacked the WHO and transformed it into an instrument of personal power that he wields for the cynical purpose of increasing pharmaceutical profits. He has single-handedly destroyed the infrastructure of public health globally. He has privatized our health systems and our food systems to serve his own purposes.” Gaming pandemics The book’s Chapter 12, Germ Games, may be arguably its most explosive, as it focuses on the US bioweapons and biosecurity apparatus, with a special mention to Robert Kadlec, who might claim leadership of the – contagious – logic according to which infectious disease poses a national security threat to the US, thus requiring a militarized response. The book argues that Kadlec, closely linked to spy agencies, Big Pharma, the Pentagon and assorted military contractors, is also linked to Fauci investments in “gain of function” experiments capable of engineering pandemic superbugs. Fauci strongly denies he’s promoted such experiments. Already in 1998 Kadlec had written an internal strategy paper for the Pentagon – though not for Fauci – promoting the role of pandemic pathogens as stealth weapons leaving no fingerprints. Since 2005 DARPA, which invented the internet by building the ARPANET in 1969, has funded biological weapons research. DARPA – call it the Pentagon’s angel investor – also developed the GPS, stealth bombers, weather satellites, pilotless drones, and that prodigy of combat, the M16 rifle. It’s important to remember that in 2017 DARPA funneled $6.5 million through Peter Daszak’s EcoHealth Alliance to fund “gain of function” work at the Wuhan lab, on top of gain of function experiments at Fort Detrick. EcoHealth Alliance was the organization through which Kadlec, Fauci and DARPA financed these gain of function experiments. DARPA also developed the GPS, stealth bombers, weather satellites, pilotless drones, and that prodigy of combat, the M16 rifle. In 2017 DARPA funneled $6.5 million through Peter Daszak’s EcoHealth Alliance to fund “gain of function” work at the Wuhan lab, on top of gain of function experiments at Fort Detrick. EcoHealth Alliance was the organization through which Kadlec, Fauci and DARPA financed these gain of function experiments, Few people know that DARPA also financed the key tech for the Moderna vaccine, starting way back in 2013. RFK Jr dutifully connects the Germ Games progress, starting with Dark Winter in 2001, which emphasized the Pentagon’s drive towards bioweapon vaccines (the code name was coined by Kadlec); the anthrax attack three weeks after 9/11; Atlantic Storm in 2003 and 2005, focused on the response to a terrorist attack unleashing smallpox; Global Mercury 2003; and Lockstep in 2010, which developed a scenario funded by the Rockefeller Foundation where we find this pearl: During the pandemic, national leaders around the world flexed their authority and imposed airtight rules and restrictions, from the mandatory wearing of face masks to body-temperature checks at the entries to communal spaces like train stations and supermarkets. Even after the pandemic faded, this more authoritarian control and oversight of citizens and their activities stuck and even intensified. In order to protect themselves from the spread of increasingly global problems – from pandemics and transnational terrorism to environmental crises and rising poverty – leaders around the world took a firmer grip on power. RFK Jr paints a picture in which, by mid-2017, the Rockefeller Foundation and US intel agencies had all but crowned Bill Gates as the top financier for the intel/military pandemic simulation business. Enter the MARS (Mountain Associated Respiratory Virus) simulation during the G20 in Germany in 2017. MARS was about a novel respiratory virus that spread out of busy markets in a mountainous border of an unnamed nation that looked very much like China. It gets curiouser and curiouser when one learns that MARS’s two moderators were very close to the Bill and Melinda Gates Foundation, and one of them, David Heymann, sat with the Moderna CEO on the Merieux Foundation USA Board. BioMerieux happens to be the French company that built the Wuhan lab. Big Pharma kisses Western intel Afterward came SPARS 2017 at the Johns Hopkins Center for Health Security. The Bill and Melinda Gates Foundation happen to be major funders of the Johns Hopkins Bloomberg School of Public Health. SPARS 2017 gamed a coronavirus pandemic running from 2025 to 2028. As RFK Jr. notes, “the exercise turned out to be an eerily precise predictor of the Covid-19 pandemic.” By 2018 bioweapons expert Peter Daszak was enthroned as the key connector through whom Fauci, Kadlec, DARPA and USAID – which used to be a CIA cover and now reports to the National Security Council – moved grants to fund gain-of-function research, including at the Wuhan Institute of Virology Biosafety Lab. Crimson Contagion, overseen by Kadlec after eight months of planning, came in August 2019. Fauci was on board the self-described “functional exercise,” representing the NIH, alongside the CDC’s Robert Redfield and several members of the National Security Council. The war game was held in secret, nationwide. The After-Action Crimson Contagion Report only came out via a FOIA request. The star of the Gates pandemic show was undoubtedly Event 201 in October 2019, held only 3 weeks before US intel may – or may not – have suspected that Covid-19 was circulating in Wuhan. Event 201 was about a global coronavirus pandemic. RFK Jr. persuasively argues that Event 201 was as close as possible to a “real-time” simulation. The book’s Germ Games chapter leads the reader to acknowledge what mainstream media have simply refused to report: how the pervasive involvement of US (and UK) intel has a secretive – yet dominating – presence in the whole response to Covid-19. A very good example is the Wellcome Trust – the UK version of the Bill and Melinda Gates Foundation – which is a spin-off of Big Pharma’s GlaxoSmith Kline. This epitomizes the marriage between Big Pharma and Western intel. The Wellcome Trust chair, from 2015 to 2020, used to be a former director general of MI5, Dame Eliza Manningham-Buller. She was also chair of the Imperial College since 2001. The “English Dr. Fauci,” Neil Ferguson, of the infamous, deadly wrong models that led to all lockdowns, was an epidemiologist working for the Wellcome Trust. These are only a few of the insights and connections woven through RFK Jr’s book. As a matter of public service, the whole lot should be available for popular scrutiny worldwide. These matters concern the whole planet, especially the Global South. Nobel laureate Luc Montaigner has noted how, “tragically for humanity, there are many, many untruths emanating from Fauci and his minions.” Even more tragic is what emanates from his masters. Tyler Durden Tue, 11/30/2021 - 23:45.....»»

Category: blogSource: zerohedgeDec 1st, 2021

Tesla’s “Rounding Error” Of Sales Improvement

Stanphyl Capital’s commentary for the month ended October 31, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). Q3 2021 hedge fund letters, conferences and more The Biggest Bubble In Modern Stock Market History We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which now has a completely absurd diluted […] Stanphyl Capital’s commentary for the month ended October 31, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Walter Schloss Series in PDF Get the entire 10-part series on Walter Schloss in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues. (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more The Biggest Bubble In Modern Stock Market History We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which now has a completely absurd diluted market cap of $1.25 trillion. Perhaps this ridiculousness is best shown graphically, courtesy of @MichalStupavsky and @AlbertBridgeCap; note that both these graphics were created hundreds of billions of dollars ago in Tesla market cap, and when viewing them please keep in mind that Tesla’s share of the world auto market is only around 1.1% (yes, one POINT one percent): And yet at some point when momentum-riding Tesla bulls (or, for that matter, bears) least expect it, TSLA will recouple with “reality,” and that’s why I continue to maintain a core short position. So here’s “reality”… Tesla has no “moat” of any kind; i.e., nothing meaningfully proprietary in terms of electric car technology, while existing automakers—unlike Tesla­—have a decades-long “experience moat” of knowing how to mass-produce, distribute and service high-quality cars consistently and profitably. Excluding sunsetting emission credit sales Tesla is barely profitable. Growth in sequential unit demand for Tesla’s cars is at a crawl relative to expectations. Elon Musk is a pathological liar who under the terms of his SEC settlement cannot deny having committed securities fraud. Tesla's Q3 Deliveries In October Tesla reported Q3 deliveries of 241,000 cars, 18,000 more than Wall Street’s “official” consensus and around 11,000 more than the 230,000-delivery “whisper number.” These (and even the entire 40,000-unit gain over Q2) are rounding errors for an auto company trading at even one-tenth of Tesla’s valuation. If in any quarter GM or VW or Toyota sold 2.04 million vehicles instead of 2 million or 1.96 million, no one would pay the slightest bit of attention to the difference. Seeing as Tesla is now being valued at nearly sixteen GMs, it’s time to start looking at its relatively tiny numerical sequential sales growth, rather than Wall Street’s sell-side hype of “percentage off a small base.” In other words, if you want to be valued at a giant multiple of “the big boys,” you should be treated as a big boy. In fact, a favorite hype story from Tesla fans has been “the China market” and its “record” number of 73,659 Q3 deliveries there. Let’s put this in perspective: this was only around 4000 more cars than in Q1 and only around 11,000 more than in Q2—these are “growth” rounding errors. And that “record” Q3 China quarter gave it just 1.5% of the overall passenger vehicle market and just 11% of the BEV market, and it had so much excess capacity that it exported tens of thousands of cars to Europe. And now in October, Tesla sales in China reportedly fell back to just 12,000 units. Remember when Musk claimed that Tesla’s Chinese domestic demand alone would need multiple factories to satisfy? Ah, the good old days! One likely way Tesla was able to post an upside surprise in Q3 deliveries was because competitors’ production (and thus inventories) were at the lowest level in decades due to the massive chip shortage, thereby eliminating a number of “Tesla alternatives.” Meanwhile, Tesla had record production because Musk (a notorious “corner-cutter”) was apparently willing to substitute untested, non-auto-grade chips for the more durable chips he couldn’t get; please see my Twitter post about this. Rounding Error As for the demand implications of the new U.S. EV tax credit (assuming it passes in its current form—which, by the way, benefits GM & Ford’s union-made cars with a $12,500 per-car credit vs. just $8000 for each Tesla), please see my Twitter thread as to why—relative to Tesla’s insane valuation and its fans’ expectations—it will likely result in just another “rounding error” of sales improvement. In its Q3 earnings report (released in October), Tesla claimed it made around $1.3 billion in free cash flow (defined as operating cash flow less capex). However, this number appears to be entirely due to working capital adjustments and not from the business itself. Let me explain: Tesla claimed operating cash flow of around $3.2 billion for the quarter, but this came with the benefit of accounts payable increasing by $702 million, receivables declining by $167 million and accrued liabilities up by $665 million while (detrimentally) prepaid expenses increased by $144 million. Adjusting for that massive net working capital benefit, operating cash flow was only a bit over $1.8 billion and with capex at $1.8 billion it means Tesla’s Q3 free cash flow was essentially zero; i.e., it’s a horrible business. Also in its Q3 report Tesla claimed it made around $1.45 billion in net income after excluding $279 million of pure-profit emission credit sales (excluded because they’ll almost entirely disappear some time next year when other automakers will have enough EVs of their own), and after adding back a $50 million Bitcoin write-down. However, that earnings number also includes what I estimate to be Tesla’s usual $300 million or so in unsustainably low warranty provisioning, and after adjusting for that and assuming no other fraudulent accounting, Tesla only earned around $1.06/share, which annualizes to $4.24. An auto industry PE multiple of 10x would thus make TSLA worth around $42/share (admittedly, more than the “$0” I once expected), while a “growth multiple” of 20x would value it at $84, which is almost a 93% discount to October’s closing price of $1114. And before you tell me that a 100% premium to the industry’s PE ratio isn’t enough, keep in mind that—as noted earlier—Tesla’s sequential unit growth is an auto industry rounding error. In fact, one could argue that Tesla’s multiple should carry a discount, considering the massive legal and financial liabilities continually generated by its pathologically lying CEO. Meanwhile Tesla continues to sell (and book cash flow, if not accounting revenue from) its fraudulent & dangerous so-called “Full Self Driving.” In a sane regulatory environment Tesla having done this for five years now would be considered “consumer fraud,” and indeed the regulatory tide may finally be turning, as in August two U.S. Senators demanded an FTC investigation and in October the NHTSA appointed a harsh critic of this deadly product to advise on its regulation. (For all known Tesla deaths see TeslaDeaths.com.) Are major write-downs and refunds on the way, killing the company’s slight “claimed profitability”? Stay tuned! And remember, the 2021 overview from Guidehouse Insights rates Tesla dead last among autonomous competitors: Proprietary Battery Technology Another favorite Tesla hype story has been built around so-called “proprietary battery technology.” In fact though, Tesla has nothing proprietary there—it doesn’t make them, it buys them from Panasonic, CATL and LG, and it’s the biggest liar in the industry regarding the real-world range of its cars. And if new-format 4680 cells enter the market some time in 2022 (as is now expected), their manufacturers will gladly sell them to anyone. Meanwhile, the quality of the Model Y—is awful, and that car faces current (or imminent) competition from the much better built electric Audi Q4 e-tron, BMW iX3, Mercedes EQA, Volvo XC40 Recharge, Volkswagen ID.4, Ford Mustang Mach E, Nissan Ariya, Hyundai Ioniq 5 and Kia EV6. And Tesla’s Model 3 now has terrific direct “sedan competition” from Volvo’s beautiful Polestar 2 and the premium version of Volkswagen’s ID.3 (in Europe), and later this year from the BMW i4, plus multiple local competitors in China. And in the high-end electric car segment worldwide the Audi e-tron and Porsche Taycan outsell the Models S & X (and the newly updated Tesla models with their dated exteriors and idiotic shifters & steering wheels won’t change this), while the spectacular new Mercedes EQS, Audi e-Tron GT and Lucid Air make the Tesla Model S look like a fast Yugo, while the extremely well reviewed new BMW iX does the same to the Model X. And oh, the joke of a “pickup truck” Tesla previewed in 2019 (and still hasn’t shown in production-ready form) won’t be much of “growth engine” either, as it will enter a dogfight of a market; in fact, in May Ford formally introduced its terrific new all-electric F-150 Lightning which now has over 150,000 reservations, Rivian’s pick-up has gotten fantastic early reviews, and in January at CES GM will introduce its electric Silverado. Meanwhile, Tesla quality ranks 30th among 33 brands in the latest J.D. Power dependability survey… …and second-to-last in the latest Consumer Reports reliability survey: …while the most recent What Car? survey shows similar results with Tesla finishing #29 out of 31, and now quality is slipping in China. Regarding safety, as noted earlier in this letter, Tesla continues to deceptively sell its hugely dangerous so-called “Autopilot” system, which Consumer Reports has completely eviscerated; God only knows how many more people this monstrosity unleashed on public roads will kill, despite the NTSB condemning it. Elsewhere in safety, in 2020 the Chinese government forced the recall of tens of thousands of Teslas for a dangerous suspension defect the company spent years trying to cover up, and now Tesla has been hit by a class-action lawsuit in the U.S. for the same defect. Tesla also knowingly sold cars that it knew were a fire hazard and did the same with solar systems, and after initially refusing to do so voluntarily, it was forced to recall a dangerously defective touchscreen. In other words, when it comes to the safety of customers and innocent bystanders, Tesla is truly one of the most vile companies on Earth. Meanwhile the massive number of lawsuits of all types against the company continues to escalate. So Here Is Tesla’s Competition In Cars (Note: These Links Are Regularly Updated)... Porsche Taycan Porsche Taycan Cross Turismo Porsche Macan Electric SUV Officially Coming in 2023 Volkswagen ID.3 Headlines VW's Electrified Future Volkswagen ID.4 Electric SUV Volkswagen ID 6 to arrive with 435-mile range in 2023 Volkswagen Aero B: new electric Passat equivalent spied VW’s Cupra brand counts on performance for Born EV Cupra, VW brand to get entry-level battery-powered cars Audi e-tron Audi e-tron Sportback Audi E-tron GT Audi Q4 e-tron Audi Q6 e-tron confirmed for 2022 launch Audi previews long-range A6 e-tron EV Audi TT set to morph into all-electric crossover Hyundai Ioniq 5 Hyundai Ioniq 6 spotted ahead of 2022 launch Hyundai Kona Electric Genesis reveals their first EV on the E-GMP platform, the electric GV60 crossover Genesis aims to go all-electric from 2025 Kia Niro Electric: 239-mile range & $39,000 before subsidies Kia EV6: Charging towards the future Kia EV4 on course to grow electric SUV range Jaguar’s All-Electric i-Pace Jaguar to become all-electric brand; Land Rover to Get 6 electric models Daimler will invest more than $47B in EVs and be all-electric ready by 2030 Mercedes EQS: the first electric vehicle in the luxury class Mercedes EQS SUV takes shape Mercedes-Benz unveils EQE electric sedan with impressive 400-mile range Mercedes EQE SUV to rival BMW iX and Tesla Model X Mercedes EQC electric SUV available now in Europe & China Mercedes-Benz Launches the EQV, its First Fully-Electric Passenger Van Mercedes-Benz EQB Makes Its European Debut, US Sales Confirmed Mercedes-Benz unveils EQA electric SUV with 265 miles of range and ~$46,000 price Ford Mustang Mach-E Available Now Ford F-150 Lightning electric pick-up available 2022 Ford set to launch ‘mini Mustang Mach-E’ electric SUV in 2023 Ford to offer EV versions of Explorer, Aviator, ‘rugged SUVs' Volvo Polestar 2 Volvo XC40 Recharge Volvo C40 electric sedan to challenge Tesla Model 3, VW ID3 Polestar 3 will be an electric SUV that shares its all-new platform with next Volvo XC90 Chevy updates, expands Bolt EV family as price drops Cadillac All-Electric Lyriq Available Spring 2022 GMC ALL-ELECTRIC SUPERTRUCK HUMMER EV GM to build electric Silverado in Detroit with estimated range of more than 400 miles GMC to launch electric Hummer SUV in 2023 GM will offer 30 all-electric models globally by 2025 GM Launches BrightDrop to Electrify the Delivery of Goods and Services Nissan vows to hop back on EV podium with Ariya Nissan LEAF e+ with 226-mile range is available now BMW leads off EV offensive with iX3 BMW expands EV offerings with iX tech flagship and i4 sedan 2022 BMW iX1 electric SUV spied BMW 3-series EV coming Rivian R1T Is the Most Remarkable Pickup We’ve Ever Driven Renault upgrades Zoe electric car as competition intensifies Renault Dacia Spring Electric SUV Renault to boost low-volume Alpine brand with 3 EVs Renault's electric Megane will debut new digital cockpit Stellantis promises 'heart-of-the-market SUV' from new, 8-vehicle EV platform Alfa Romeo is latest Stellantis brand to get all-electric future Peugeot e-208 PEUGEOT E-2008: THE ELECTRIC AND VERSATILE SUV Peugeot 308 will get full-electric version Citroen compact EV challenges VW ID3 on price Maserati to launch electric sports car Mini Cooper SE Electric Toyota's bZ4X EV gets 300-mile range, steer by wire; first of 7 BEVs by 2025 Opel sees electric Corsa as key EV entry 2021 Vauxhall Mokka revealed as EV with sharp looks, massive changes Skoda Enyaq iV electric SUV offers range of power, battery sizes Electric Skoda Enyaq coupe to muscle-in on Tesla Model 3 Skoda plans small EV, cheaper variants to take on French, Korean rivals Nio to launch in five more European countries after Norway BYD will launch electric SUV in Europe The Lucid Air Achieves an Estimated EPA Range of 517 Miles on a Single Charge Bentley converting to electric-only brand All-electric Rolls-Royce Spectre to launch in 2023 – firm to be EV-only by 2030 Aston Martin will build electric vehicles in UK from 2025 Meet the Canoo, a Subscription-Only EV Pod Coming in 2021 Two new electric cars from Mahindra in India; Global Tesla rival e-car soon Former Saab factory gets new life building solar-powered Sono Sion electric cars Foxconn aims for 10% of electric car platform market by 2025 And In China... How VW Group plans to dominate China's EV market VW Goes Head-to-Head With Tesla in China With New ID.4 Crozz Electric SUV Volkswagen’s ID.3 EV to be produced by JVs with SAIC, FAW in 2021 2022 VW ID.6 Revealed With Room For Seven And Two Electric Motors China-built Audi e-tron rolls off production line in Changchun Audi Q2L e-tron debuts at Auto Shanghai Audi will build Q4 e-tron in China Audi Q5 e-tron Confirmed For China Audi in cooperation company for local electric car production with FAW FAW Hongqi starts selling electric SUV with 400km range for $32,000 FAW (Hongqi) to roll out 15 electric models by 2025 BYD goes after market left open by Tesla with four cheaper models for budget-conscious buyers BYD said to launch premium NEV brand ‘Dolphin’ in 2022 Top of Form Bottom of Form Daimler & BYD launch DENZA electric vehicle for the Chinese market Geely announces premium EV brand Zeekr Geely, Mercedes-Benz launch $780 million JV to make electric smart-branded cars Mercedes styled Denza X 7-seat electric SUV to hit market Mercedes ‘makes mark’ with China-built EQC BMW, Great Wall to build new China plant for electric cars BAIC Goes Electric, & Establishes Itself as a Force in China’s New Energy Vehicle Future BAIC BJEV, Magna ready to pour RMB2 bln in all-electric PV manufacturing JV Toyota, BYD will jointly develop electric vehicles for China Lexus to launch EV in China taking on VW and Tesla GAC Aion about to start volume production of 1,000-km range AION LX GAC Toyota to ramp up annual capacity by 400,000 NEVs GAC kicks off delivery of HYCAN 007 all-electric SUV Nio – Ready For Tomorrow Nio steps up plans for mass-market brand to compete with VW, Toyota Xpeng Motors sells multiple EV models SAIC-GM to build Ultium EV platform in Wuhan Chevrolet Menlo Electric Vehicle Launched in China Buick Launches VELITE 6 PLUS MAV Electric Vehicle in China Buick Velite 7 EV And Velite 6 PHEV Launch In China Dongfeng launches the all-electric Voyah  PSA to accelerate rollout of electrified vehicles in China SAIC, Alibaba-backed EV brand IM begins presale of first model L7 Hyundai Motor Transforming Chongqing Factory into Electric Vehicle Plant Polestar said to plan China showroom expansion to compete with Tesla Jaguar Land Rover's Chinese arm invests £800m in EV production Renault reveals series urban e-SUV K-ZE for China Renault & Brilliance detail electric van lineup for China Renault forms China electric vehicle venture with JMCG Honda to start sales of new EV-branded vehicles in China in 2022 Geely launches new electric car brand 'Geometry' – will launch 10 EVs by 2025 Geely, Foxconn form partnership to build cars for other automakers Fiat Chrysler, Foxconn Team Up for Electric Vehicles Baidu to create an intelligent EV company with automaker Geely Leapmotor starts presale of C11 electric SUV on Jan. 1 2021 Changan forms subsidiary Avatar Technology to develop smart EVs with Huawei, CATL WM Motors/Weltmeister Chery Seres Enovate China's cute Ora R1 electric hatch offers a huge range for less than US$9,000 Singulato JAC Motors releases new product planning, including many NEVs Seat to make purely electric cars with JAC VW in China Iconiq Motors Hozon Aiways Skyworth Auto Youxia CHJ Automotive begins to accept orders of Leading Ideal ONE Infiniti to launch Chinese-built EV in 2022 Human Horizons Chinese smartphone giant Xiaomi to launch electric car business with $10 billion investment Lifan Technology to roll out three EV models with swappable batteries in 2021 Here’s Tesla’s Competition In Autonomous Driving... Waymo ranked top & Tesla last in Guidehouse leaderboard on automated driving systems Tesla has a self-driving strategy other companies abandoned years ago Fiat Chrysler, Waymo expand self-driving partnership for passenger, delivery vehicles Waymo and Lyft partner to scale self-driving robotaxi service in Phoenix Volvo, Waymo partner to build self-driving vehicles Jaguar and Waymo announce an electric, fully autonomous car Renault, Nissan partner with Waymo for self-driving vehicles Cruise and GM Team Up with Microsoft to Commercialize Self-Driving Vehicles Cadillac Super Cruise Sets the Standard for Hands-Free Highway Driving Honda Joins with Cruise and General Motors to Build New Autonomous Vehicle Honda launching Level 3 autonomous cars Volkswagen moves ahead with Autonomous Driving R&D for Mobility as a Service Volkswagen teams up with Microsoft to accelerate the development of automated driving VW taps Baidu's Apollo platform to develop self-driving cars in China Ford's electric Mustang will offer hands-free driving technology in 2021 ARGO AI AND FORD TO LAUNCH SELF-DRIVING VEHICLES ON LYFT NETWORK BY END OF 2021 Hyundai and Kia Invest in Aurora Toyota, Denso form robotaxi partnership with Aurora Aptiv and Hyundai Motor Group complete formation of autonomous driving joint venture Amazon’s Zoox unveils electric robotaxi that can travel up to 75 mph Nvidia and Mercedes Team Up to Make Next-Gen Vehicles Daimler's heavy trucks start self-driving some of the way SoftBank, Toyota's self-driving car venture adds Mazda, Suzuki, Subaru Corp, Isuzu Daihatsu  Continental & NVIDIA Partner to Enable Production of Artificial Intelligence Self-Driving Cars Mobileye and Geely to Offer Most Robust Driver Assistance Features Mobileye Starts Testing Self-Driving Vehicles in Germany Mobileye and NIO Partner to Bring Level 4 Autonomous Vehicles to Consumers Lucid Chooses Mobileye as Partner for Autonomous Vehicle Technology AutoX, backed by Alibaba Nissan gives Japan version of Infiniti Q50 hands-free highway driving Hyundai to start autonomous ride-sharing service in Calif. Pony.ai raises $462 million in Toyota-led funding Baidu kicks off trial operation of Apollo robotaxi in Changsha Toyota to join Baidu's open-source self-driving platform Baidu, WM Motor announce strategic partnership for L3, L4 autonomous driving solutions Volvo will provide cars for Didi's self-driving test fleet BMW and Tencent to develop self-driving car technology together BMW, NavInfo bolster partnership in HD map service for autonomous cars in China GM Invests $300 M in Momenta to deliver self-driving technologies in China FAW Hongqi readies electric SUV offering Level 4 autonomous driving Tencent, Changan Auto Announce Autonomous-Vehicle Joint Venture Huawei teams up with BAIC BJEV, Changan, GAC to co-launch self-driving car brands GAC Aion, DiDi Autonomous Driving to co-develop driverless NEV model BYD partners with Huawei for autonomous driving Lyft, Magna in Deal to Develop Hardware, Software for Self-Driving Cars Xpeng releases autonomous features for highway driving Nuro Becomes First Driverless Car Delivery Service in California Deutsche Post to Deploy Test Fleet Of Fully Autonomous Delivery Trucks ZF autonomous EV venture names first customer Magna’s new MAX4 self-driving platform offers autonomy up to Level 4 Groupe PSA’s safe and intuitive autonomous car tested by the general public Mitsubishi Electric to Exhibit Autonomous-driving Technologies in New xAUTO Test Vehicle Apple acquires self-driving startup Drive.ai Motional to begin robotaxi testing with Hyundai Ioniq 5 in Los Angeles JD.com Delivers on Self-Driving Electric Trucks NAVYA Unveils First Fully Autonomous Taxi Fujitsu and HERE to partner on advanced mobility services and autonomous driving Here’s Where Tesla’s Competition Will Get Its Battery Cells... Panasonic (making deals with multiple automakers) LG Samsung SK Innovation Toshiba CATL BYD Volkswagen to Build Six Electric-Vehicle Battery Factories in Europe How GM's Ultium Battery Will Help It Commit to an Electric Future Ultium (General Motors & LG joint venture) GM to develop lithium-metal batteries with SolidEnergy Systems Ford, SK Innovation announce EV battery joint venture BMW & Ford Invest in Solid Power to Secure All Solid-State Batteries for Future Electric Vehicles Stellantis, LG Energy Solution to form battery JV for N. American market Toyota to build U.S. battery plant Daimler joins Stellantis as partner in European battery cell venture ACC Renault signs EV battery deals with Envision, Verkor for French plants Nissan to build $1.4bn EV battery plant in UK with Chinese partner UK companies AMTE Power and Britishvolt plan $4.9 billion investment in battery plants Freyr Verkor Farasis Microvast Akasol Cenat Wanxiang Eve Energy Svolt Romeo Power ProLogium Hyundai Motor developing solid-state EV batteries Daimler Morrow Here’s Tesla’s Competition In Charging Networks... Electrify America is spending $2 billion building a high-speed U.S. charging network GM to distribute up to 10 chargers to each of its dealerships starting early 2022 GM, EVgo partner to expand U.S. charging network Circle K Owner Plans Electric-Car Charging Push in U.S., Canada 191 U.S. Porsche dealers are installing 350kw chargers ChargePoint to equip Daimler dealers with electric car chargers GM and Bechtel plan to build thousands of electric car charging stations across the US Ford introduces 12,000 station charging network, teams with Amazon on home installation Shell Plans To Deploy Around 500,000 Charging Points Globally By 2025 Petro-Canada Introduces Coast-to-Coast Canadian Charging Network Volta is rolling out a free charging network Ionity Europe E.ON and Virta launch one of the largest intelligent EV charging networks in Europe Volkswagen plans 36,000 charging points for electric cars throughout Europe Smatric has over 400 charging points in Austria Allego has hundreds of chargers in Europe PodPoint UK charging stations BP Chargemaster/Polar is building stations across the UK Instavolt is rolling out a UK charging network Fastned building 150kw-350kw chargers in Europe Aral To Install Over 100 Ultra-Fast Chargers In Germany Deutsche Telekom launches installation of charging network for e-cars Total to build 1,000 high-powered charging points at 300 European service-stations NIO teams up with China’s State Grid to build battery charging, swapping stations Volkswagen-based CAMS launches supercharging stations in China Volkswagen, FAW Group, JAC Motors, Star Charge formally announce new EV charging JV BMW to Build 360,000 Charging Points in China to Juice Electric Car Sales BP, Didi Jump on Electric-Vehicle Charging Bandwagon Evie rolls out ultrafast charging network in Australia Evie Networks To Install 42 Ultra-Fast Charging Sites In Australia And Here’s Tesla’s Competition In Storage Batteries... Panasonic Samsung LG BYD AES + Siemens (Fluence) GE Bosch Hitachi ABB Toshiba Saft Johnson Contols EnerSys SOLARWATT Schneider Electric Sonnen Kyocera Generac Kokam NantEnergy Eaton Nissan Tesvolt Kreisel Leclanche Lockheed Martin EOS Energy Storage ESS UET electrIQ Power Belectric Stem ENGIE Redflow Renault Primus Power Simpliphi Power redT Energy Storage Murata Bluestorage Adara Blue Planet Tabuchi Electric Aggreko Orison Moixa Powin Energy Nidec Powervault Kore Power Shanghai Electric Schmid 24M Ecoult Innolith LithiumWerks Natron Energy Energy Vault Ambri Voltstorage Cadenza Innovation Morrow Gridtential Villara Elestor   Thanks and stay healthy, Mark Spiegel Updated on Nov 1, 2021, 11:19 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkNov 1st, 2021

Alphabet"s (GOOGL) Google Ups Smartphone Game With Pixel Phones

Alphabet's (GOOGL) Google unveils Pixel 6 and Pixel 6 Pro. The move is likely to bolster its position in the smartphone market. Alphabet’s GOOGL division Google has launched its long-awaited next-generation Pixel phones — Pixel 6 and Pixel 6 Pro — with a display screen of 6.4 inches and 6.7 inches, respectively.Notably, the high-end smartphones are built on Google’s first system-on-chip called Tensor, which has been developed for offering strong battery life and quick speech recognition feature, leveraging AI and image-processing capabilities of the company.Hence, these phones are the first ones that are comprised of a chip other than Qualcomm, MediaTek and Apple’s AAPL chip.The new Pixel phones are based on the latest Android version — Android 12 — which delivers advanced safety and personalization features.Apart from this, the devices are comprised of a Titan M2 security chip for ensuring passcode protection, encryption and secure app-enabled transactions.With the latest launch, Google ups its game against companies like Apple and Samsung SSNLF, which are well-known providers of high-end advanced smartphones.More Into the DetailsThe camera included in the devices reflects skin tone with accuracy, as it features enhanced white balance and exposure tuning. Also, the camera is well-equipped to control and lessen stray light in photos.All these make Pixel 6 and Pixel 6 Pro better choices for capturing darker skin tones more accurately. Further, there are motion mode features like Action Pan and Long Exposure, which add movement to the shots.We note that both models will go on sale from Oct 28 onward, wherein Pixel 6 is priced at $599 and Pixel 6 Pro costs $899.In addition to the phones, the company has rolled out a subscription service called Pixel Pass in the United States, which offers the best of Google. The service costs $45 and $55 per month with Pixel 6 and Pixel 6 Pro, respectively, and offers access to Google One, YouTube Premium and YouTube Music Premium, and Google Play Pass and Preferred Care.Further, Pixel Pass offers the option to customers to upgrade to a new Pixel after two years.Alphabet Inc. Price and Consensus  Alphabet Inc. price-consensus-chart | Alphabet Inc. QuoteSmartphone Market Holds PromiseWe believe that Google, with its latest versions of the Pixel phone, is well-poised to cater to the ever-increasing demand for smartphones especially amid the pandemic.In this data-driven world, smartphones have become inevitable in day-to-day life by enabling users to get necessary, important and urgent work done via phones without any hassle.The growing penetration of internet use globally is another factor that is bolstering the demand for smartphones on a persistent basis.Per a report from IDC, the worldwide smartphone shipment in 2021 is anticipated to hit 1.37 billion units, reflecting growth of 7.4%. Growing uptake of 5G smartphones is acting as the primary factor behind the boom in the smartphone market.Per a Technavio report, the global smartphone market is likely to witness a CAGR of more than 6% between 2021 and 2025.Intensifying CompetitionGiven the upbeat scenario, companies like Apple, Samsung, Lenovo, Nokia NOK, Xiaomi, Motorola, Vivo, Oppo and OnePlus are also leaving no stone unturned to expand their share in the smartphone market.Recently, Apple, which is continuously riding on the popularity of iPhone and its brand loyalty, unveiled four iPhone models — iPhone 13, iPhone 13 mini, iPhone 13 Pro and iPhone 13 Pro Max.Samsung, which is also enjoying strong customer momentum on the back of its high-end as well as an affordable range of smartphones, has come up with Galaxy Z Flip 3 and Galaxy Z Fold 3 models.Meanwhile, Xiaomi and OnePlus are persistently gaining traction in the market with their advanced featured affordable smartphones.Additionally, Nokia, Motorola, Lenovo, Oppo and Vivo continue to enjoy solid customer momentum on the back of their low-end smartphones with strong features.Nevertheless, Google’s innovative skills, robust voice assistant and widely preferred Android operating system worldwide are likely to continue aiding the adoption rate of its Pixel phones.Currently, Alphabet carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Apple Inc. (AAPL): Free Stock Analysis Report Nokia Corporation (NOK): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksOct 20th, 2021

A Look At Tesla’s Relatively Tiny Numerical Sequential Sales Growth

Stanphyl Capital’s commentary for the month ended September 30, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). Q2 2021 hedge fund letters, conferences and more We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which currently has a diluted market cap of $868 billion, roughly equal to the $870 […] Stanphyl Capital’s commentary for the month ended September 30, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get Our Activist Investing Case Study! Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below! (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q2 2021 hedge fund letters, conferences and more We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which currently has a diluted market cap of $868 billion, roughly equal to the $870 billion (non-diluted) combined market caps of Toyota ($253 billion), VW ($141 billion), Daimler ($96 billion), GM ($76 billion), BMW ($65 billion), Stellantis ($60 billion), Ford ($57 billion), Honda ($53 billion), Hyundai ($49 billion) and Nissan ($20 billion), despite annualized sales for Tesla of around 800,000 cars a year to their over 50 million. The core points of our Tesla short thesis are: Tesla has no “moat” of any kind; i.e., nothing meaningfully proprietary in terms of electric car technology, while existing automakers—unlike Tesla­—have a decades-long “experience moat” of knowing how to mass-produce, distribute and service high-quality cars consistently and profitably, as well as the ability to subsidize losses on electric cars with profits from their conventional cars. Excluding sunsetting emission credit sales Tesla is barely profitable. Growth in sequential unit demand for Tesla’s cars has slowed to a crawl. Elon Musk is a pathological liar who under the terms of his SEC settlement cannot deny having committed securities fraud. Tesla's Expected Q3 Sales Growth Latest estimates are that Tesla is expected to report around 29,000 more deliveries for Q3 vs. Q2 (approximately 230,000 vs. Q1’s 201,000), a rounding error for an auto company trading at even one-tenth of Tesla’s valuation. If in any quarter GM or VW or Toyota sold 2.55 million vehicles instead of 2.58 million or 2.525 million, no one would pay the slightest bit of attention to the difference. Well guess what? Seeing as Tesla is being valued at more than eleven GMs, it’s time to start looking at its relatively tiny numerical sequential sales growth, rather than Wall Street’s sell-side hype of “percentage off a small base.” In other words, if you want to be valued at a giant multiple of “the big boys,” it’s time you were treated as a big boy! Meanwhile in July, thanks to an suspiciously high gross margin and very “non-growthy” reduced R&D expense, Tesla reported an improved Q2 2021, claiming to have earned $788 million excluding $354 million of pure-profit emission credit sales (excluded because they’ll almost entirely disappear some time next year when other automakers will have enough EVs of their own). However, that earnings number also includes what I estimate to be around $300 million in unsustainably low warranty provisioning, and after adjusting for that plus the credit sales, I believe Tesla earned a sustainable .43/share, which annualizes to $1.72. An auto industry PE multiple of 10x would thus make TSLA worth around $17/share (admittedly, more than the “$0” I previously expected). A “growth multiple” of 20x would value it at $34, which is more than a 95% discount to September’s closing price of $775. And before you tell me that a 100% premium to the industry’s PE ratio isn’t enough, keep in mind that—as noted earlier—Tesla’s sequential unit growth is an auto industry rounding error. In fact, one could argue that Tesla’s multiple should carry a discount, considering the massive legal and financial liabilities continually generated by its pathologically lying CEO. Meanwhile, on the Q2 earnings call Musk admitted that the so-called “Full Self Driving” he’s been selling for five years (and that Consumer Reports calls outright dangerous) doesn’t work, and he said it again in August following an “AI Day” in which he tried to cover up the Tesla’s autonomy cluelessness with an inert plastic statue of a robot and a man dancing in a unitard. (You had to see it to believe it and then you still wouldn’t believe it!)  In a saner regulatory environment Tesla’s selling of “Full Self Driving” for five years now would be considered “consumer fraud,” and indeed in August two U.S. Senators finally demanded an FTC investigation while the NHTSA opened yet another safety investigation. (For all known Tesla deaths see TeslaDeaths.com.) Will there be major write-downs and refunds given, killing the company’s slight “profitability”? Stay tuned! And remember, the 2021 overview from Guidehouse Insights rates Tesla dead last among autonomous competitors: The Chinese Government's Love Affair With Tesla Is Over Another favorite hype story from Tesla fans has been “the China market.” Sadly, that government’s love affair with Tesla is over and Q2 Tesla sales there were down 10% from Q1 while Q3 looks to be down approximately 10% more. In July Tesla sold just 8621 cars in China (with the balance of that month’s production exported to Europe) and in August only 12,885. This an absolute disaster for Tesla, as massive July price cuts on both the Model Y and the Model 3 meant that in August in China it was supposed to sell around 30,000; instead it had to export all that excess capacity. (It still may sell around 50,000 in China in September, but so what? With insignificantly small sequential growth for three quarters now, Tesla’s Chinese “hypergrowth” story is over.) Remember when Musk claimed Tesla would have so much domestic Chinese demand that it would need multiple factories there to satisfy it? Ah, the good old days! Another favorite Tesla hype story has been built around so-called “proprietary battery technology.” In fact though, Tesla has nothing proprietary there—it doesn’t make them, it buys them from Panasonic, CATL and LG, and it’s the biggest liar in the industry regarding the real-world range of its cars. A recent story has been the supposedly imminent arrival of a new “4680” design that Teslemmings and their sell-side Wall Street shills claim will allow Tesla to “leapfrog” the batteries of its competitors. Sadly for them though, in a June interview with the CEO of Tesla’s primary battery supplier Panasonic, we learned that not only are these cells still in the “production testing” phase (and thus nowhere near ready for commercial production), but that if they *do* work, Panasonic will sell them to anyone.  And then news broke that Tesla extended its current battery supply deal with CATL until the year 2025, and in August it revealed it will even be using those Chinese-made batteries in the U.S. If those great proprietary 4680s were coming any time soon, why would Tesla need to do that? Obviously it wouldn’t, which explains why in the Q2 earnings press release (and on the call) Musk admitted they don’t know how long (if ever) it will take to get those 4680 batteries into production. Oh well… I guess it’s on to the next nonsensical stock pump! Meanwhile, the quality of the Model Y—is awful, and that car faces current (or imminent) competition from the much better built electric Audi Q4 e-tron, BMW iX3, Mercedes EQA, Volvo XC40 Recharge, Volkswagen ID.4, Ford Mustang Mach E, Nissan Ariya, Hyundai Ioniq 5 and Kia EV6. And Tesla’s Model 3 now has terrific direct “sedan competition” from Volvo’s beautiful Polestar 2 and the premium version of Volkswagen’s ID.3 (in Europe), and later this year from the BMW i4, plus multiple local competitors in China. And in the high-end electric car segment worldwide the Audi e-tron and Porsche Taycan outsell the Models S & X (and the newly updated Tesla models with their dated exteriors and idiotic shifters & steering wheels won’t change this), while the spectacular new Mercedes EQS and Audi e-Tron GT make any Tesla look like a Yugo, while the extremely well reviewed new BMW iX does the same to the Tesla Model X. And oh, the joke of a “pickup truck” Tesla previewed in 2019 (and still hasn’t shown in production-ready form) won’t be much of “growth engine” either, as it will enter a dogfight of a market; in fact, in May Ford formally introduced its terrific new all-electric F-150 Lightning which now has over 150,000 reservations and Rivian’s pick-up has gotten fantastic early reviews. Also, the Tesla semi-truck  has been delayed until at least 2022 (and possibly forever, as it depends on the aforementioned “4680” batteries that don’t exist). Meanwhile, Tesla quality ranks 30th among 33 brands in the most recent J.D. Power dependability survey… …and second-to-last in the most recent Consumer Reports reliability survey: …while the most recent What Car? survey shows similar results with Tesla finishing #29 out of 31, and now quality is slipping in China. Flawed Autopilot System Regarding safety, as noted earlier in this letter, Tesla continues to deceptively sell its hugely dangerous so-called “Autopilot” system, which Consumer Reports has completely eviscerated; God only knows how many more people this monstrosity unleashed on public roads will kill, despite the NTSB condemning it. Elsewhere in safety, in 2020 the Chinese government forced the recall of tens of thousands of Teslas for a dangerous suspension defect the company spent years trying to cover up, and now Tesla has been hit by a class-action lawsuit in the U.S. for the same defect. Tesla also knowingly sold cars that it knew were a fire hazard and did the same with solar systems, and after initially refusing to do so voluntarily, it was forced to recall a dangerously defective touchscreen. In other words, when it comes to the safety of customers and innocent bystanders, Tesla is truly one of the most vile companies on Earth. Meanwhile the massive number of lawsuits of all types against the company continues to escalate. So here is Tesla’s competition in cars... (note: these links are regularly updated) Porsche Taycan Porsche Taycan Cross Turismo Porsche Macan Electric SUV Officially Coming in 2023 Volkswagen ID.3 Headlines VW's Electrified Future Volkswagen ID.4 Electric SUV Volkswagen ID 6 to arrive with 435-mile range in 2023 Volkswagen Aero B: new electric Passat equivalent spied VW’s Cupra brand counts on performance for Born EV Cupra, VW brand to get entry-level battery-powered cars Audi e-tron Audi e-tron Sportback Audi E-tron GT Audi Q4 e-tron Audi Q6 e-tron confirmed for 2022 launch Audi previews long-range A6 e-tron EV Audi TT set to morph into all-electric crossover Hyundai Ioniq 5 Hyundai Ioniq 6 spotted ahead of 2022 launch Hyundai Kona Electric Genesis reveals their first EV on the E-GMP platform, the electric GV60 crossover Genesis aims to go all-electric from 2025 Kia Niro Electric: 239-mile range & $39,000 before subsidies Kia EV6: Charging towards the future Kia EV4 on course to grow electric SUV range Jaguar’s All-Electric i-Pace Jaguar to become all-electric brand; Land Rover to Get 6 electric models Daimler will invest more than $47B in EVs and be all-electric ready by 2030 Mercedes EQS: the first electric vehicle in the luxury class Mercedes EQS SUV takes shape Mercedes-Benz unveils EQE electric sedan with impressive 400-mile range Mercedes EQC electric SUV available now in Europe & China Mercedes-Benz Launches the EQV, its First Fully-Electric Passenger Van Mercedes-Benz EQB Makes Its European Debut, US Sales Confirmed Mercedes-Benz unveils EQA electric SUV with 265 miles of range and ~$46,000 price Ford Mustang Mach-E Available Now Ford F-150 Lightning electric pick-up available 2022 Ford set to launch ‘mini Mustang Mach-E’ electric SUV in 2023 Ford to offer EV versions of Explorer, Aviator, ‘rugged SUVs' Volvo Polestar 2 Volvo XC40 Recharge Volvo C40 electric sedan to challenge Tesla Model 3, VW ID3 Polestar 3 will be an electric SUV that shares its all-new platform with next Volvo XC90 Chevy updates, expands Bolt EV family as price drops Cadillac All-Electric Lyriq Available Spring 2022 GMC ALL-ELECTRIC SUPERTRUCK HUMMER EV GM to build electric Silverado in Detroit with estimated range of more than 400 miles GMC to launch electric Hummer SUV in 2023 GM will offer 30 all-electric models globally by 2025 GM Launches BrightDrop to Electrify the Delivery of Goods and Services Nissan vows to hop back on EV podium with Ariya Nissan LEAF e+ with 226-mile range is available now BMW leads off EV offensive with iX3 BMW expands EV offerings with iX tech flagship and i4 sedan 2022 BMW iX1 electric SUV spied BMW 3-series EV coming Rivian R1T Is the Most Remarkable Pickup We’ve Ever Driven Renault upgrades Zoe electric car as competition intensifies Renault Dacia Spring Electric SUV Renault to boost low-volume Alpine brand with 3 EVs Renault's electric Megane will debut new digital cockpit Stellantis promises 'heart-of-the-market SUV' from new, 8-vehicle EV platform Alfa Romeo is latest Stellantis brand to get all-electric future Peugeot e-208 PEUGEOT E-2008: THE ELECTRIC AND VERSATILE SUV Peugeot 308 will get full-electric version Citroen compact EV challenges VW ID3 on price Maserati to launch electric sports car Mini Cooper SE Electric Toyota steps up electric vehicle push with plans for 15 new models Opel sees electric Corsa as key EV entry 2021 Vauxhall Mokka revealed as EV with sharp looks, massive changes Skoda Enyaq iV electric SUV offers range of power, battery sizes Electric Skoda Enyaq coupe to muscle-in on Tesla Model 3 Skoda plans small EV, cheaper variants to take on French, Korean rivals Nio to launch in five more European countries after Norway BYD will launch electric SUV in Europe The Lucid Air Achieves an Estimated EPA Range of 517 Miles on a Single Charge Bentley converting to electric-only brand Rolls-Royce is working on EV called 'Silent Shadow' Aston Martin will build electric vehicles in UK from 2025 Meet the Canoo, a Subscription-Only EV Pod Coming in 2021 Two new electric cars from Mahindra in India; Global Tesla rival e-car soon Former Saab factory gets new life building solar-powered Sono Sion electric cars Foxconn aims for 10% of electric car platform market by 2025 And in China… How VW Group plans to dominate China's EV market VW Goes Head-to-Head With Tesla in China With New ID.4 Crozz Electric SUV Volkswagen’s ID.3 EV to be produced by JVs with SAIC, FAW in 2021 2022 VW ID.6 Revealed With Room For Seven And Two Electric Motors China-built Audi e-tron rolls off production line in Changchun Audi Q2L e-tron debuts at Auto Shanghai Audi will build Q4 e-tron in China Audi in cooperation company for local electric car production with FAW FAW Hongqi starts selling electric SUV with 400km range for $32,000 FAW (Hongqi) to roll out 15 electric models by 2025 BYD goes after market left open by Tesla with four cheaper models for budget-conscious buyers BYD said to launch premium NEV brand ‘Dolphin’ in 2022 Top of Form Bottom of Form Daimler & BYD launch DENZA electric vehicle for the Chinese market Geely announces premium EV brand Zeekr Geely, Mercedes-Benz launch $780 million JV to make electric smart-branded cars Mercedes styled Denza X 7-seat electric SUV to hit market Mercedes ‘makes mark’ with China-built EQC BMW, Great Wall to build new China plant for electric cars BAIC Goes Electric, & Establishes Itself as a Force in China’s New Energy Vehicle Future BAIC BJEV, Magna ready to pour RMB2 bln in all-electric PV manufacturing JV Toyota, BYD will jointly develop electric vehicles for China Lexus to launch EV in China taking on VW and Tesla GAC Aion about to start volume production of 1,000-km range AION LX GAC Toyota to ramp up annual capacity by 400,000 NEVs GAC kicks off delivery of HYCAN 007 all-electric SUV Nio – Ready For Tomorrow Nio steps up plans for mass-market brand to compete with VW, Toyota Xpeng Motors sells multiple EV models SAIC-GM to build Ultium EV platform in Wuhan Chevrolet Menlo Electric Vehicle Launched in China Buick Launches VELITE 6 PLUS MAV Electric Vehicle in China Buick Velite 7 EV And Velite 6 PHEV Launch In China Dongfeng launches the all-electric Voyah  PSA to accelerate rollout of electrified vehicles in China SAIC, Alibaba-backed EV brand IM begins presale of first model L7 Hyundai Motor Transforming Chongqing Factory into Electric Vehicle Plant Polestar said to plan China showroom expansion to compete with Tesla Jaguar Land Rover's Chinese arm invests £800m in EV production Renault reveals series urban e-SUV K-ZE for China Renault & Brilliance detail electric van lineup for China Renault forms China electric vehicle venture with JMCG Honda to roll out over 20 electric models in China by 2025 Geely launches new electric car brand 'Geometry' – will launch 10 EVs by 2025 Geely, Foxconn form partnership to build cars for other automakers Fiat Chrysler, Foxconn Team Up for Electric Vehicles Baidu to create an intelligent EV company with automaker Geely Leapmotor starts presale of C11 electric SUV on Jan. 1 2021 Changan forms subsidiary Avatar Technology to develop smart EVs with Huawei, CATL WM Motors/Weltmeister Chery Seres Enovate China's cute Ora R1 electric hatch offers a huge range for less than US$9,000 Singulato JAC Motors releases new product planning, including many NEVs Seat to make purely electric cars with JAC VW in China Iconiq Motors Hozon Aiways Skyworth Auto Youxia CHJ Automotive begins to accept orders of Leading Ideal ONE Infiniti to launch Chinese-built EV in 2022 Human Horizons Chinese smartphone giant Xiaomi to launch electric car business with $10 billion investment Lifan Technology to roll out three EV models with swappable batteries in 2021 Here’s Tesla’s Competition In Autonomous Driving... Waymo ranked top & Tesla last in Guidehouse leaderboard on automated driving systems Tesla has a self-driving strategy other companies abandoned years ago Fiat Chrysler, Waymo expand self-driving partnership for passenger, delivery vehicles Waymo and Lyft partner to scale self-driving robotaxi service in Phoenix Volvo, Waymo partner to build self-driving vehicles Jaguar and Waymo announce an electric, fully autonomous car Renault, Nissan partner with Waymo for self-driving vehicles Cruise and GM Team Up with Microsoft to Commercialize Self-Driving Vehicles Cadillac Super Cruise Sets the Standard for Hands-Free Highway Driving Honda Joins with Cruise and General Motors to Build New Autonomous Vehicle Honda launching Level 3 autonomous cars Volkswagen moves ahead with Autonomous Driving R&D for Mobility as a Service Volkswagen teams up with Microsoft to accelerate the development of automated driving VW taps Baidu's Apollo platform to develop self-driving cars in China Ford's electric Mustang will offer hands-free driving technology in 2021 ARGO AI AND FORD TO LAUNCH SELF-DRIVING VEHICLES ON LYFT NETWORK BY END OF 2021 Hyundai and Kia Invest in Aurora Toyota, Denso form robotaxi partnership with Aurora Aptiv and Hyundai Motor Group complete formation of autonomous driving joint venture Amazon’s Zoox unveils electric robotaxi that can travel up to 75 mph Nvidia and Mercedes Team Up to Make Next-Gen Vehicles Daimler's heavy trucks start self-driving some of the way SoftBank, Toyota's self-driving car venture adds Mazda, Suzuki, Subaru Corp, Isuzu Daihatsu  Continental & NVIDIA Partner to Enable Production of Artificial Intelligence Self-Driving Cars Mobileye and Geely to Offer Most Robust Driver Assistance Features Mobileye Starts Testing Self-Driving Vehicles in Germany Mobileye and NIO Partner to Bring Level 4 Autonomous Vehicles to Consumers Lucid Chooses Mobileye as Partner for Autonomous Vehicle Technology AutoX, backed by Alibaba Nissan gives Japan version of Infiniti Q50 hands-free highway driving Hyundai to start autonomous ride-sharing service in Calif. Pony.ai raises $462 million in Toyota-led funding Baidu kicks off trial operation of Apollo robotaxi in Changsha Toyota to join Baidu's open-source self-driving platform Baidu, WM Motor announce strategic partnership for L3, L4 autonomous driving solutions Volvo will provide cars for Didi's self-driving test fleet BMW and Tencent to develop self-driving car technology together BMW, NavInfo bolster partnership in HD map service for autonomous cars in China GM Invests $300 M in Momenta to deliver self-driving technologies in China FAW Hongqi readies electric SUV offering Level 4 autonomous driving Tencent, Changan Auto Announce Autonomous-Vehicle Joint Venture Huawei teams up with BAIC BJEV, Changan, GAC to co-launch self-driving car brands GAC Aion, DiDi Autonomous Driving to co-develop driverless NEV model BYD partners with Huawei for autonomous driving Lyft, Magna in Deal to Develop Hardware, Software for Self-Driving Cars Xpeng releases autonomous features for highway driving Nuro Becomes First Driverless Car Delivery Service in California Deutsche Post to Deploy Test Fleet Of Fully Autonomous Delivery Trucks ZF autonomous EV venture names first customer Magna’s new MAX4 self-driving platform offers autonomy up to Level 4 Groupe PSA’s safe and intuitive autonomous car tested by the general public Mitsubishi Electric to Exhibit Autonomous-driving Technologies in New xAUTO Test Vehicle Apple acquires self-driving startup Drive.ai Motional to begin robotaxi testing with Hyundai Ioniq 5 in Los Angeles JD.com Delivers on Self-Driving Electric Trucks NAVYA Unveils First Fully Autonomous Taxi Fujitsu and HERE to partner on advanced mobility services and autonomous driving Here’s where Tesla’s competition will get its battery cells… Panasonic (making deals with multiple automakers) LG Samsung SK Innovation Toshiba CATL BYD Volkswagen to Build Six Electric-Vehicle Battery Factories in Europe How GM's Ultium Battery Will Help It Commit to an Electric Future Ultium (General Motors & LG joint venture) GM to develop lithium-metal batteries with SolidEnergy Systems Ford, SK Innovation announce EV battery joint venture BMW & Ford Invest in Solid Power to Secure All Solid-State Batteries for Future Electric Vehicles Daimler joins Stellantis as partner in European battery cell venture ACC Renault signs EV battery deals with Envision, Verkor for French plants Nissan to build $1.4bn EV battery plant in UK with Chinese partner UK companies AMTE Power and Britishvolt plan $4.9 billion investment in battery plants Toyota's game-changing solid-state battery en route for 2021 debut Freyr Verkor Farasis Microvast Akasol Cenat Wanxiang Eve Energy Svolt Romeo Power ProLogium Hyundai Motor developing solid-state EV batteries Daimler Morrow Here’s Tesla’s Competition In Charging Networks... Electrify America is spending $2 billion building a high-speed U.S. charging network GM, EVgo partner to expand U.S. charging network Circle K Owner Plans Electric-Car Charging Push in U.S., Canada 191 U.S. Porsche dealers are installing 350kw chargers ChargePoint to equip Daimler dealers with electric car chargers GM and Bechtel plan to build thousands of electric car charging stations across the US Ford introduces 12,000 station charging network, teams with Amazon on home installation Shell Plans To Deploy Around 500,000 Charging Points Globally By 2025 Petro-Canada Introduces Coast-to-Coast Canadian Charging Network Volta is rolling out a free charging network Ionity Europe E.ON and Virta launch one of the largest intelligent EV charging networks in Europe Volkswagen plans 36,000 charging points for electric cars throughout Europe Smatric has over 400 charging points in Austria Allego has hundreds of chargers in Europe PodPoint UK charging stations BP Chargemaster/Polar is building stations across the UK Instavolt is rolling out a UK charging network Fastned building 150kw-350kw chargers in Europe Aral To Install Over 100 Ultra-Fast Chargers In Germany Deutsche Telekom launches installation of charging network for e-cars Total to build 1,000 high-powered charging points at 300 European service-stations NIO teams up with China’s State Grid to build battery charging, swapping stations Volkswagen-based CAMS launches supercharging stations in China Volkswagen, FAW Group, JAC Motors, Star Charge formally announce new EV charging JV BMW to Build 360,000 Charging Points in China to Juice Electric Car Sales BP, Didi Jump on Electric-Vehicle Charging Bandwagon Evie rolls out ultrafast charging network in Australia Evie Networks To Install 42 Ultra-Fast Charging Sites In Australia And here’s Tesla’s competition in storage batteries… Panasonic Samsung LG BYD AES + Siemens (Fluence) GE Bosch Hitachi ABB Toshiba Saft Johnson Contols EnerSys SOLARWATT Schneider Electric Sonnen Kyocera Generac Kokam NantEnergy Eaton Nissan Tesvolt Kreisel Leclanche Lockheed Martin EOS Energy Storage ESS UET electrIQ Power Belectric Stem ENGIE Redflow Renault Primus Power Simpliphi Power redT Energy Storage Murata Bluestorage Adara Blue Planet Tabuchi Electric Aggreko Orison Moixa Powin Energy Nidec Powervault Kore Power Shanghai Electric Schmid 24M Ecoult Innolith LithiumWerks Natron Energy Energy Vault Ambri Voltstorage Cadenza Innovation Morrow Gridtential Villara Elestor Thanks and stay healthy, Mark Spiegel Updated on Oct 1, 2021, 11:05 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 1st, 2021

GitLab Inc. (NASDAQ:GTLB) Q1 2024 Earnings Call Transcript

GitLab Inc. (NASDAQ:GTLB) Q1 2024 Earnings Call Transcript June 5, 2023 GitLab Inc. misses on earnings expectations. Reported EPS is $-0.3 EPS, expectations were $-0.14. Darci Tadich: Thank you for joining us today for GitLab’s First Quarter of Fiscal Year 2024 Financial Results Presentation. GitLab’s Co-Founder and CEO, Sid Sijbrandij; and GitLab’s Chief Financial Officer, […] GitLab Inc. (NASDAQ:GTLB) Q1 2024 Earnings Call Transcript June 5, 2023 GitLab Inc. misses on earnings expectations. Reported EPS is $-0.3 EPS, expectations were $-0.14. Darci Tadich: Thank you for joining us today for GitLab’s First Quarter of Fiscal Year 2024 Financial Results Presentation. GitLab’s Co-Founder and CEO, Sid Sijbrandij; and GitLab’s Chief Financial Officer, Brian Robins will provide commentary on the quarter and fiscal year. Please note, we will be opening up the call for panelist questions. [Operator Instructions] Before we begin, I’ll cover the Safe Harbor statement. During this conference call, we may make forward-looking statements within the meaning of the federal securities laws. These statements involve assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those discussed or anticipated. For a complete discussion of risks associated with these forward-looking statements in our business, please refer to our earnings release distributed today in our SEC filings, including our most recent quarterly report on Form 10-Q and our most recent annual report on Form 10-K. Our forward-looking statements are based upon information currently available to us. We caution you to not place undue reliance on forward-looking statements, and we undertake no duty or obligation to update or revise any forward-looking statement or to report any future events, or circumstances, or to reflect the occurrence of unanticipated events. We may also discuss financial performance measures that differ from comparable measures contained in our financial statements prepared in accordance with US GAAP. These non-GAAP measures are not intended to be a substitute for our GAAP results. A reconciliation of these non-GAAP measures to the most comparable GAAP financial measures is included in our earnings press release, which along with these reconciliations and additional supplemental information are available at ir.gitlab.com. A replay of today’s call will also be posted on ir.gitlab.com. I will now turn the call over to GitLab’s Co-Founder and Chief Executive Officer, Sid Sijbrandij. Sid Sijbrandij: Thank you for joining us today. I want to start off by thanking so many of you for the well-wishes I’ve received regarding my health. I’m doing well and I remain committed as ever to GitLab success. I’m pleased with how our business performed in the first quarter of FY’24. We exceeded our own guidance for both revenue growth and non-GAAP profitability. We executed well towards our goal of making our customers successful on our AI-powered DevSecOps platform. This quarter we generated revenue of $126.9 million. This represents growth of 45% year-over-year. Our dollar based net retention rate was 128%. Our first quarter results continued to demonstrate improving operating leverage in our business. Our non-GAAP operating margin improved by almost 1700 basis points year-over-year and we remain committed to growing in a responsible manner. I want to start this call with one of the most exciting technology developments of our time. AI and ML. AI represents a major shift for our industry. It fundamentally changes the way that software is developed, and we believe it will accelerate our ability to help organizations make software faster. I’m excited about this new wave of technology innovation, and we continue to focus on incorporating AI throughout our DevSecOps platform. We’re innovating at a fast pace. In 1Q, we delivered five new AI features and in the first half of May alone, we delivered five additional features. All of these are available to customers now and we continue to iterate on Code Suggestions. This feature allows developers to write code more efficiently by receiving Code Suggestions as they type. Code Suggestions is available on gitlab.com for all users, while in beta, we expect Code Suggestions will be generally available later this year. One of the guiding principles with Code Suggestions is to make it available and accessible to all developers everywhere. We also extended language support, so that more developers can realize the benefits of AI on our platform. In 1Q, we increased language support from the initial six languages to now 13 languages. Code Suggestions is uniquely built with privacy first as a critical foundation. Our customers proprietary source code never leaves GitLab’s cloud infrastructure. This means that their source code stays secure. In addition, model output is not stored and not used as training data. AI is not only changing how software is developed, it’s also amplifying the value of having a DevSecOps platform. DevSecOps is a category that we created and we’re seeing it enter a mainstream adoption phase. We are seeing industry analysts recognizing this. I’m pleased to share that GitLab was recently recognized as the only leader in the Forrester Wave for integrated software delivery platforms 2023. We are excited to see the market mature and recognize the value of an integrated software delivery platform, a strategy that GitLab has followed from the start. This quarter we had many conversations with senior level customers, but one with a CTO from a top five European bank really stands out. At first, we focused on many of our differentiated features that only a DevSecOps platform can provide. For example, we talked about the benefits of value stream dashboards, DORA metrics and compliance on a single platform. When the conversation moved into AI, the CTO said something extremely interesting. He said, cogeneration is only one aspect of the development cycle. If we only optimize cogeneration, everything else downstream from the development team, including QA security and operations breaks, breaks because these other teams involved in software development can’t keep up. This point, incorporating AI throughout the software development life cycle is at the core of our AI strategy. Today, our customers have the ability to use Code Suggestions for co-creation, suggested reviewers for code review. Explain this vulnerability for vulnerability remediation, value stream forecasting for predicting future team efficiency and much more. We’re proud to have ten AI features available to customers today, almost three times more than the competition. Applying AI to a single data store for the full software development lifecycle also creates compelling business outcomes. We believe that this is something that can only be done with GitLab. We see a lot of excitement surrounding AI at the executive level. We are hearing from customers that AI is motivating them to assess how they develop, secure and operate software through a new lens. Enterprise level companies who may not have been in a market until 2024, 2025, 2026 are re-evaluating their strategies. On top of that, there’s new personas entering the mix. As chief information security officers navigate these new AI powered world, they are working to empower their teams to benefit from AI and apply appropriate governance, security compliance and auditability. In all, we believe that AI will increase the total addressable market for several reasons. First, AI will make writing code easier, which we believe will expand the audience of people such as junior and citizen developers who build software. Second, as these developers become more productive, we see software becoming less expensive to create. We believe this will fuel demand for even more software. More developers will be needed to meet this additional demand. And third, we expect customers will increasingly turn to GitLab as they build machine learning models and AI into their applications. As we add ModelOps capabilities to our DevSecOps platform, this will invite data science teams as new personas and will allow these teams to work alongside their DevSecOps counterparts. We see ModelOps as a big opportunity for GitLab. Expanding the addressable market will also create an opportunity to capture greater value. Later this year, we plan to introduce an AI add-on focused on supporting development teams. This new add-on will include Code Suggestions functionality. We anticipate this will be priced at $9 per user per month billed annually. This add-on will be available later this year across all our tiers. All of this innovation accentuates a broader theme for our business. The differentiation between a Dev and a DevSecOps platform. We believe that an AI-powered platform focused solely on the developer persona is incomplete. It is missing essential security operations and enterprise functionality. Remember, developers spend only a small fraction of their time developing code. The real promise of AI extends far beyond code creation. And this is where GitLab has a structural advantage. We are the most comprehensive DevSecOps platform in the market. Features like Code Suggestions and Remote Development are important accelerants for developer efficiency. And today, GitLab has more AI features geared towards developers than our competitors. However, that isn’t enough. In order to achieve a ten times faster cycle time on projects, enterprises need an end-to-end platform that works across the entire software development life cycle. Let me describe some of GitLab’s key security operations and enterprise differentiators. For security only GitLab has dynamic application security testing, container scanning, API, security, compliance management and security policy management. In operations, only GitLab has feature flags, infrastructure as code, error tracking, service desk and incident management. And for enterprises only GitLab has portfolio management, OKR management, value stream Management, DORA metrics and design management. Let me illustrate the value of a DevSecOps platform with one of our customers, Lockheed Martin. Lockheed Martin’s customers depend on them to help them overcome their most complex challenges and to stay ahead of emerging threats. Their customers need the most technologically advanced solutions. Lockheed Martin’s engineering teams require speed and flexibility to meet the specific mission needs of each customers. They also require shared expertise and infrastructure to ensure affordability. Lockheed Martin has a history of using a wide variety of DevOps tools and needed to improve automation, standardize security practices and collaboration. They choose to go big with GitLab, greatly reducing their tool chain and cutting complexity while reducing costs and workload. Lockheed Martin team has reported eighty times faster CI Pipeline builds 90% less time spent on system maintenance. They’ve retired thousands of Jenkins servers. Lockheed Martin continues to grow with GitLab and is looking to migrate even more projects to their DevSecOps platform. One of their software strategy executives said by switching to GitLab and automating deployment teams have moved from monthly or weekly deliveries to daily or multiple daily deliveries. Lockheed is a great example of the power of a DevSecOps platform and we see this in other use cases as well, such as compliance. In the quarter, a large health care provider purchased GitLab Ultimate for a platform features. They needed to meet specific compliance requirements from their auditors. They determined that GitLab is the best way to achieve their objectives. Another customer we expanded business with in Q1 is NatWest Group, a relationship bank for the digital world. NatWest Group is focused on delivering sustainable growth and results of fostering a better, simpler banking experience. Last year, NatWest Group chose GitLab dedicated. He wanted to enable their engineers to use a common cloud engineering platform to deliver a better experience for customers and colleagues. Five months into the program, we are pleased that NatWest has reported shorter onboarding times and productivity gains. This led to NatWest choosing GitLab professional services to accelerate their transformation by supporting training certifications and developer days. In summary, we’re confident in a strong value proposition that GitLab provides to customers. GitLab is the most comprehensive AI-powered DevSecOps enterprise platform. The significant return on investment, quick payback period and well-documented positive business outcomes are resonating globally. We’re trusted by more than 50% of the Fortune 100 to secure and protect their most valuable assets. We also believe we’re in the early stages of capturing an estimated $40 billion addressable market, a market that we’ve seen evolve from point solutions to a platform from DIY DevOps to a DevSecOps platform. And AI will speed up different aspects of software creation and development. This in turn creates the need for a more robust security compliance and planning capabilities. In today’s era of rapid innovation, the power of a platform like GitLab to enable faster cycle times truly shines. I’ll now turn it over to Brian Robins, GitLab’s Chief Financial Officer. Brian Robins: Thank you, Sid, and thank you again for everyone joining us today. I’d like to spend a moment discussing the macro environment, the financial impact of our recently implemented premium pricing change and provide some insights into the financial impact of our AI products. Then I will quickly recap our first quarter financial results and key operating metrics and conclude with our guidance. Let me first touch on some of the watch points I discussed on prior calls. We continue to see sales cycles remaining at 4Q levels due to more people involved in deal approvals. Contraction improved over 4Q, but is higher than prior quarters. Like 4Q, contraction is driven almost entirely by lower seat counts with minimal down tearing. I was pleased with the bookings predictability in 1Q. It was much better than 4Q. As we mentioned on the prior call, we raised the price of our premium skew for the first time in five years. Over that time frame, we added over 400 new features, transitioned from a Dev platform to a DevSecOps platform. We shared that we expected the premium price increase of minimum impact in FY’24 with greater impact in FY’25 and beyond. The price increase which took effect on April 3rd is going as planned. We only had one month of renewals impacted by the price increase in the quarter. To-date, customer churn is unchanged for the premium customers who renewed in April and our average ARR per customer increased in line with our expectations. Now on to the way we are thinking about the financials and the impact of our AI products. We continue to invest in people and infrastructure to support AI. While we have had some teams working on AI features, we recently shifted additional engineers from other teams to support the work on AI. As a result, this has not led to significant incremental expenses on engineering talent. Additionally, we have made investments in our cloud provider spend to support our AI and R&D efforts. In addition, we also continue to leverage partners help drive our AI vision. This has included partnership announcements with Google Cloud and Oracle. The Google Partnership allows us to use Google Cloud AI functionality to make our own AI offerings better by leveraging their toolset. The partnership with Oracle makes it easier for our customers to deploy their own AI and machine learning workloads using Oracle’s cloud infrastructure. Both of these partnerships help create strategic differentiation for our customers in a financially responsible manner. Now turning to the quarter. Revenue of 126.9 million this quarter represents an increase of 45% organically from the prior year. We ended 1Q with over 7400 customers with ARR of at least $5,000 compared to over 7000 customers in the fourth quarter of FY’23 and over 5100 customers in the prior year. This represents a year-over-year growth rate of approximately 43%. Currently, customers with greater than 5000 ARR represent approximately 95% of our total ARR. We also measure the performance and growth of our larger customers who we define as those spending more than 100,000 in ARR with us. At the end of the first quarter of FY’24, we had 760 customers with ARR of at least $100,000 compared to 697 customers in 4Q of FY’23 and 545 customers in the first quarter of FY’23. This represents a year-over-year growth rate of approximately 39%. As many of you know, we do not believe calculated billings to be a good indicator of our business. Given that prior period, comparisons can be impacted by a number of factors, most notably our history of large prepaid multiyear deals. This quarter, total RPO grew 37% year-over-year to 460 million and cRPO grew 44% to 324 million for the same time frame. We ended our first quarter with a dollar based net retention rate of 128%. As a reminder, this is a trailing 12 month metric that compares expansion activity of customers over the last 12 months with the same cohort of customers during the prior 12 month period. The dollar based net retention of 128% was driven by lower seat expansion and contraction due to seats. The ultimate tier continues to be our fastest growing tier, representing 42% of ARR for the first quarter of FY’24, compared with 39% of ARR in the first quarter of FY’23. Non-GAAP gross margins were 91% for the quarter, which is slightly improved from both the immediate preceding quarter for the first quarter of FY’23. SaaS represents over 25% of total ARR, and we’ve been able to maintain non-GAAP gross margins despite the higher cost of delivery. This is another example of how we continue to drive efficiencies in the business. We saw improved operating leverage this quarter, largely driven by realizing greater efficiencies as we continue to scale the business. Non-GAAP operating loss of 15 million or negative 12% of revenue compared to a loss of 24.8 million or negative 28% of revenue in 1Q of last year. 1Q FY’24 includes 5.6 million of expenses related to our JV and majority owned subsidiary compared to 3.7 million in 1Q FY’23. Operating cash use was 11 million in the first quarter of FY’24 compared to 28.2 million use in the same quarter of last year. Now let’s turn to guidance. We are assuming the macroeconomic headwinds and trends in the business we have seen over the last few quarters continue. There has been no change to our overall guidance philosophy. For the second quarter of FY’24, we expect total revenue of 129 million to 130 million, representing a growth rate of 28% to 29% year-over-year. We expect non-GAAP operating loss of 11 million to 10 million and we expect a non-GAAP net loss per share of negative $0.03 to negative $0.02, assuming a 153 million weighted average shares outstanding. For the full year FY’24, we now expect total revenue of 541 million to 543 million, representing a growth rate of approximately 28% year-over-year. We expect non-GAAP operating loss of 47 million to 43 million and we expect non-GAAP net loss per share of negative $0.18 to negative $0.14 assuming a 153 million weighted average shares outstanding. On a percentage basis, our new annual FY’24 guidance implies a non-GAAP operating improvement of approximately 1200 basis points year-over-year at the midpoint of our guidance. Over a longer term, we believe that a continued targeted focus on growth initiatives and scaling the business will yield further improvements in unit economics. The guidance has us on track to achieve cash flow breakeven for FY’25. For modeling purposes, we estimate that our fully diluted share count is 173 million. Separately, I would like to provide an update on JiHu, our China joint venture. Our goal remains to deconsolidate JiHu. However, we cannot predict the likelihood or timing of when this may potentially occur. Thus, for modeling purposes for FY’24, we now forecast approximately 29 million of expenses related to JiHu compared with 19 million in FY’23. These JiHu expenses represent approximately negative 5% of our total implied negative 8% non-GAAP operating loss for FY’24. Our number one priority as a management team is to drive revenue growth, but we’ll do that responsibly. There has been no philosophical change in how we run the business to maximize shareholder value over the long-term. Before we take questions, I’d like to thank our customers for trusting GitLab to help them achieve their business objectives. Also want to thank our team members, partners and the wider GitLab community for their contributions this quarter. With that, we’ll now move to Q&A. To ask a question, please use the chat feature and post your question directly to IR questions. We’re ready for the first question. Operator: A – Darci Tadich: Our first question comes from Rob with Piper Sandler. Q&A Session Follow Gitlab Inc. Follow Gitlab Inc. We may use your email to send marketing emails about our services. Click here to read our privacy policy. Rob Owens: All right. I think I did that correctly after three years of using Zoom. Good afternoon, guys. Sid Sijbrandij: Hey, Rob. Good afternoon. Rob Owens: Curious to hear an update on customer conversations. Obviously a stronger than expected quarter, but we are seeing this deceleration, I think, across all high-growth tech companies. So both Gen AI — in the macro, how should we think about pressure on net retention rates, customer acquisition that’s coming from customers taking a more prudent approach in the current budgetary environment versus, I guess, rethinking needs for Dev headcount and re-evaluating which Dev tools to purchase just given all the Gen AI innovations lately? Sid Sijbrandij: Yeah. Thanks, Rob. And before I answer that question, maybe an update on my health. I just completed my last round of systemic chemotherapy. So happy about that. Rob Owens: Congratulations. Sid Sijbrandij: Thanks. And also no sign of detectable disease, and I’m excited about GitLab’s future and continuing my role as CEO and Chair. Yes, lots of things to unpack in your question. We see the macro trends continuing, and that’s putting pressure on seat count. That was the same last quarter, and we anticipate that trend to continue. At the same time, we’re super excited of what the macro is doing to the mindset of customers, because they say, hey, now we — it’s time to consolidate. And at the same time, we see that the analysts are seeing that, hey, this is consolidating as a market. So we believe that DevOps platform is going to be the way that people will consolidate. And we have the most comprehensive DevSecOps platform, which is also great if you look at the application of AI. We’re able to apply AI not just for Code Suggestions, but apply it across the entire spectrum. We have more than 10 features that we were able to ship. And those 10 features, they drive value at every part along the stage. And as for how that influences the TAM, which you alluded to, we think AI is going to make it easier for more people to enter the fray. So we think it was a supply of more people using the product. At the same time, when you see that software development becomes easier, we believe there’s going to be more demand for it. Software development used to be very expensive. AI makes it more affordable. There’s going to be more demand. And more demand, again, means more people entering the fray. And last but certainly not least, it’s an opportunity for us to manage not just the code that companies have, but also their models. And that’s what we do with our MLOps functionality. We already allow you to run experiments with GitLab. We want to extend to a full MLOps managed platform where we add the data engineers to the constituents that use GitLab. Rob Owens: Great. And if I can sneak a quick one in for Brian. Just regarding DBOs in the linearity of the quarter, was that either large deals at the end? Or was it very back-end weighted? And if I look at that receivable base and assume collections on it, looks like you could turn the corner from a cash flow perspective relatively soon. So any commentary on turning free cash flow positive? Thanks. Brian Robins: Yeah, I’ll touch on DSOs, and I’ll touch on free cash flow breakeven. And so from a DSO perspective, we were more weighted towards the end of the quarter. But the good news is that we — our amount of bad debt over the last three years has not exceeded 1%, and our age receivables has been very, very consistent. And so some of our European customers have requested Net 45, Net 60. And so we’ve accommodated that just because of the macro and the bad debt expense being so low. From a free cash flow breakeven perspective, we committed to be free cash flow breakeven in FY 2025. And we’ve also stated some of the actions that we’ve taken previously will accelerate our path to profitability, but haven’t given a specific time line on that. Rob Owens: All right. Thanks, guys. Brian Robins: Thanks, Rob. Darci, you’re muted. Darci Tadich: Up next, we have Joel with Truist. Joel Fishbein: Thank you. And Sid, I’m sending prayers to you, and congrats on making it through the treatment. Sid Sijbrandij: Thank you. Joel Fishbein: Brian, just a quick follow-up for you on Rob’s question. Congrats on the margin improvement. I think that’s — you’ve done a really good job. Can you give us a little bit more color on some of the things that you’re doing to continue to drive towards cash flow breakeven while still investing in some of these new initiatives that you’re doing, which obviously you’ve spent a lot of time talking about some of these AI programs that are coming out. And then just as a follow-up to that, have you like tested this $9 increased — license increase to your customer base and whether or not that they’ll — there’s going to be any pushback there? Thank you. Brian Robins: Yes, Joel, absolutely. Thanks for the question. As Sid and I have always stated since we went public is the number one objective at GitLab is to grow, but we’ll do that responsibly. And we’ve tried to demonstrate that every quarter. And so nothing has changed in that front. Our non-GAAP gross margin percent went up to 91%, even though we continue to have really high SaaS growth and SaaS is greater than 25% of our overall revenue. And so we’re continuing to look at all areas within the business where we can optimize, but we aren’t doing that at the expense of growth because that’s the number one objective at the company. I think we demonstrated that across all cost categories and we’ll continue to look at that quarter-over-quarter. On the $9 increase, we haven’t tested that yet. From a guidance perspective, most of the cost for that is in headcount and cloud costs, and that’s included in the guidance that we gave. And so we don’t expect any changes from a guidance perspective. Joel Fishbein: Thank you. Darci Tadich: Next, we have Sterling with MoffettNathanson. Sterling Auty: Thanks. Hi, guys. Sid, congratulations as well on the completion of the treatments. Hopefully, you got a chance to actually ring the bell. Brian just — and Sid just another follow-up question just on the pricing. So you touched upon it, but I want to make sure to put a fine point here. Did it have any impact on win rates or length of deals where maybe customers were asking and negotiating a little bit harder because of the price increase? Or anything in terms of size of initial lands that may have been impacted because of the price increase? And if not, does that actually change when you think some of the benefits of the pricing increase will actually flow through the revenue line? Brian Robins: Yes. Thanks, Sterling. I guess for everyone on the call, let me just briefly touch on the price increase. We haven’t raised prices in five years. And over that time period, we added 400 new features to the platform. And so that was the genesis of the price increase. The guidance we gave last quarter and today include the price increase. As you know, the price was effective in early April. And so we really only had a short period of less than a month for that. But I am happy to say that the renewal rates and the churn and the land of new customers have been better than expected. And so we’re happy with the results that we’ve seen in just that one month time period. Sterling Auty: All right. Great. Thank you. Darci Tadich: Our next question comes from Matt with RBC. Matthew Hedberg: Hey, guys. Great. Thanks for taking my questions and I’ll offer my congrats, Sid. That’s the best news of the call, really good to hear you doing well. I noticed Ultimate ticked up. I believe, Brian, you said it was 42%, which, last year, was kind of flattish, really the whole year. I was curious what was driving that? Is that sort of AI showing up some of those migrations? Is it more of the not security? Or perhaps is it — is there any of the price increase on premium that’s maybe driving folks to Ultimate? Brian Robins: Yes. Thanks, Matt. When we talk about Ultimate, as we said before, is we don’t set the sales compensation to basically compensate on Ultimate versus Premium. We want to try to take as much friction out of the process. For the consumer as well, we do the same on SaaS and self-managed as well. And so Ultimate, the strength in Ultimate is really based on the underlying value that we’re driving to our customers. The ROI on Ultimate, Forrester did a study, it was 427% over three years, and payback was around six months. And so when I looked at the quarter and looked at sort of Premium, Ultimate and sort of the breakout between contraction, churn, first order and expansion, Ultimate had — churn was consistent with a bunch of prior quarters. Contraction was very consistent. Our growth was just as good as prior quarters, and we had a really strong first order quarter as well. And so Ultimate continues to do well. It’s our fastest-growing tier, and we’re happy with the results. Matthew Hedberg: That’s fantastic. And then maybe just if I could follow up with one with Sid. One of the questions that we get from developer — from investors the most is, does Gen AI put pressure on Dev, developer seat count. I think you talked about a little bit in your prepared remarks, but maybe could you put a finer point on sort of the question of P times Q. And does the number of seats go down in the future? Or do you think it stays consistent or maybe even goes up? Sid Sijbrandij: Yes. We believe that generative AI will expand the market. So first of all, you make the product easier. Like coding today is hard, and AI makes it easier. So we expect the citizen developers, these junior developers to start coding. That code needs to be managed somewhere. And that is in GitLab. The second thing is you make it — you — when a developer can do more, you bring down the price, and that should increase demand for development and software development activities. Third, what you have is today is a DevSecOps platform, but we’ve already articulated that we want to be a place where you manage not just code, but also MLOps. MLOps is the management of data and the management of models. Models are harder to manage than code. They change over time, and they have a lot of risks, security risks, discrimination risks, risks that you’re doing the wrong thing, risk that they are outdated. So it’s a really interesting space to expand the product to. And for example, today, if you have an experiment in MLFlow, you can link it to the experiment in GitLab. And in the future, we’ll plan to come out with a model registry in GitLab. So those are all reasons why we think the market will expand. One other way to look at it is you have generative AI. It produces more code. All that codes also needs to be secured, also need to put in operations. So if you don’t have a good DevSecOps platform, you create a bottleneck at the beginning. That bottleneck is solved with the DevSecOps platform. Matthew Hedberg: Thank you Darci Tadich: We will now hear from Koji with Bank of America. Koji Ikeda: Hey, guys. Thanks for taking the questions. Maybe a question for Sid or Brian here. I wanted to ask you a question about how you plan on attacking the other 50% of the Fortune 500 or I’m sorry, the Fortune 100 that you don’t have. Is it still a primary land-and-expand strategy? Or is it going to be more of a higher level sale for these customers? I was just kind of hoping you could dig into that a little bit more, please. Sid Sijbrandij: Yes. I think it’s certainly that it is both the bottoms-up sale but also the top-down sales. So we have a direct sales motion, but also a channel sales motion that’s getting more important. Channel sales, think of our partners, AWS and GCP, where we work with them to go to customers. And we’re talking to CTOs, CSOs, CIOs, and we help them see the picture. What we commonly do as a value stream analysis. We point out all the different tools they use throughout the cycle and how that adds up in cycle time. And with GitLab, they’re going to save on tooling costs, they can save on the cost of integrating that tooling. They can make their people more productive, and they can go faster through that cycle and get initiatives out. So it’s certainly something we’re going to market with. And as you said, our goal is 100% of the Fortune 100. Koji Ikeda: Got it. And maybe a follow-up here for Brian on kind of going back to free cash flow. This quarter, free cash flow is higher than non-GAAP operating income. And I recall there’s some cash flow mechanics around contract duration that should be mostly be out of the model by this point. So is that right with the cash flow mechanics? And does free cash flow trend higher than non-GAAP operating income from here on an annual basis? Just could you just dig into that just a little bit more for me, please? Brian Robins: Yes, absolutely. When we joined — when I first joined the company, we were not incentivizing the sales force to do multiyear deals because we had such a high gross retention rate. And so we really pushed for one year deals in this. That’s why you saw billings and RPO is — go down and wouldn’t grow at the same rate as cRPO or short-term calculated billings. But we still continue to have prepaid multiyear deals within our existing book of business. And so as those contracts renew, you’ll see some lumpiness in our billings and collections, and Q1 was one of those quarters. Koji Ikeda: Got it. Thank you. Brian Robins: Thank you. Darci Tadich: Next, we have Michael with KeyBank. Michael Turits: Hey, guys. Brian Robins: Hey, Michael. Michael Turits: Can you hear me? Sorry about that. Brian Robins: We can. Go ahead. Michael Turits: So can you talk again you know Brian you said about how competition has gone. Microsoft, obviously, they have been very visible around Copilot. You announced a lot of features. But how has the sort of day in and day out competition gone. As you said, Brian, sales cycles have not extended, but are people sizing you up against each other and differently. How are they entering this discussion about whether or not [Technical Difficulty] Brian Robins: Yes. I think I got most of it, Michael. And I think I’ll repeat the question was how has the sales cycle changed with between us and Microsoft, and what — if you had noticed any change — noticeable things within the quarter. So one thing to note this quarter is on last earnings call, I talked about how the first month of the quarter was very different than the second and third month of the quarter. This quarter is really predictable. And so I was happy with the predictability of the quarter. Week Three, we called the quarter and landed really close to that. The sales cycles in first quarter remained at fourth quarter levels. And so there wasn’t a lot of change there. As I talked about earlier, Ultimate being greater than 50% of the bookings and continue to do well. I think that shows some of the differentiation between us and Microsoft. The hyperscalers as well had a great quarter as well. They grew over 200% year-over-year from a bookings perspective. And also this quarter, we had lower discounting than the previous quarter. And so the trends with Microsoft remain pretty consistent where we still don’t see any competition at about 50% of the deals. We see them in very little deals, but there is more discussion around OpenAI, ChatGPT and Copilot. All right. Darci, we’ll go into the next one. Darci Tadich: Derrick with Cowen is next. Derrick Wood: Great. Thanks. And Sid congrats on the news. I wanted to start, in the press release, you talked about an expanded partnership with Oracle and a new AI/ML offering, enabling customers to speed up model train and inference. Can you give us a little more detail around those new partner initiatives? And then just from a broader perspective, how you’re thinking about the Gen AI related revenue opportunities in the quarters ahead? Sid Sijbrandij: Yes, thanks for the question. So we’re really excited about our partnership with Oracle Cloud. They have a great customer base. And what it means is that our customers now can now run AI and ML workloads on DPU-enabled GitLab runners on the Oracle Cloud infrastructure, and that’s a great powerful infrastructure. Additionally, we’re available in Oracle’s marketplace, expanding our distribution. So our strategy, with AI in mind, is to partner closer with the hyperscalers. And the toughest one is Microsoft. We try to partner there too, but with everyone else, we see a lot of momentum, and that’s AWS, GCP and Oracle. We want to get closer. We want to enable our customers to run their normal workloads, their AI workloads there, and where you can expect us to have more announcements going forward. Derrick Wood: Okay. Maybe a quick one for you, Brian. Appreciate getting more exact numbers on net revenue retention rates. Kind of looking forward and with respect to your guidance for the rest of the year, is there any kind of target ranges that you’d guide us towards? Or how we should be thinking about trends around gross retention and expansion factors? Brian Robins: We didn’t give out the specifics of those metrics. What I will say is this quarter — last quarter was more predictable. And so it makes it easier from a modeling perspective. And everything is factored into guidance. And so we didn’t give specific metrics for those. Derrick Wood: Got it. Okay. Thank you. Darci Tadich: Kash with Goldman Sachs. Kash Rangan: Okay. Great. Thanks for taking my question. Sid good to see that you’re recovering very well and congratulations on the quarter. It looks like business stabilized for you guys. I had a question on the generative AI capabilities. At what point are we looking to — is there any need for further differentiation of GitLab versus the competition? This auto code generation feature that has been made much off, right? Is that a real sticking point in conversations? Do you think the customer base really values and appreciates the broader set of AI capabilities that GitLab has to offer? So it looks like there is a bit of a perception issue in the market that you don’t have those kinds of features that the competition appears to have. If you can debunk that mix for us, that will be great. And then one for you, Brian, what does the month of May look like from a linearity standpoint? The net expansion rates that you saw as improving in the March quarter, it does hold up in the month of May as well. Thank you so much. Sid Sijbrandij: Thanks, Kash. Like in AI, you have the code generation. If you just produce a whole bunch more code, then it’s going to get log jammed later down the pipeline. You also need to do more security fixes. You need to deploy more. So we’re really fortunate that we have a single application, a single data store for the entire DevSecOps cycle, and we can apply to AI to all of them. And that’s led us to having three times as many publicly usable AI features as our competition. That is a big advantage. As long as at the beginning that, of course, you also need the code suggestions. But having the whole rest make sure that if you get more effective there, it works, and you get a faster cycle time throughout and that’s a really exciting development. Kash Rangan: And Brian I had one for you. Yeah, thank you. Brian Robins: And just on the second part of the question, as you would expect, we track a number of metrics internally from top of the pipeline to bottom conversion rates, piecing, expansion, churn, contraction and so forth. And I’m happy quarter-to-date, things are as expected. And so like I’ve mentioned last quarter, it was more predictable in fourth quarter and quarter-to-date and we’ll see how the quarter finishes out, but it’s as expected on all those metrics that we track internally. Kash Rangan: Great. Good to see the quarter and the results. Thank you so much. Sid Sijbrandij: Thanks, Kash. Darci Tadich: Next is Karl with UBS. Karl Keirstead: Thank you. Maybe, Brian, I’ll point this to you. So as all of us try to run back of the envelope math about what the $9 per seat monetization plan might mean for fiscal ’25, can you offer any guardrails as to things we should keep in mind so we’re — maybe we’re a little bit tight on what it could mean. And I guess maybe as two quick follow-ups. Is there any reason to believe that it wouldn’t be applicable to all of your paying users? Or does it feel like it would be relevant only for a subset? And then on top of that, do you think this could actually accelerate the conversion of the free user base to the paid user base such that the opportunity set is beyond our estimate of what you’re paying user base looks like? Thank you. Brian Robins: Lots in there to unpack. Just on FY 2025, we haven’t given out guidance for next year yet. And so I really can’t comment on that. The $9 that Sid talked about in the script is baked into our guidance for this year. Karl Keirstead: Okay. But Brian does it — could it accelerate a free-to-paid conversion? I’m not asking you for fiscal ’25 guidance, just kind of framework as we try to model out what it could mean. Anything you’d offer up as we take our best shot? Brian Robins: I think that all that we’re doing is to make the developer, the security and operations persona is more efficient and to allow and make better, faster, cheaper, more secure. And so I think anything that you do that enables that should help out on all the metrics that you track and model. Karl Keirstead: Okay. Great. Congrats on the quarter. Brian Robins: Appreciate it, Karl. Darci Tadich: We will now hear from Jason with William Blair. Jason Ader: Yeah. Hi, guys. Can you hear me okay? Brian Robins: We can. Jason Ader: All right. Great. I wanted to ask about whether you’re exploring a consumption element to your pricing model and how that might work, especially on the cloud side. Sid Sijbrandij: Yes, thanks for that. We already have consumptives elements in our model. So for example, for compute and for storage, you pay on a consumption basis. We’re adding features to that consumption, for example, in GitLab 16 released on June 22nd, we released MacOS runners, we released Linux runners, we had the Oracle partnership where we have more AI runners, DPU runners. So that is a small part of our revenue today, but we’re releasing additional features. I think over time, you see that the licensing is going to become more flexible. We have cloud licensing today and that allows us to be more flexible in what you pay for. For example, the add-on we are envisioning for AI, right now, it’s efficient to something if you use it, you pay for it, otherwise not. We’ll see what we end up releasing, but that’s what we’re thinking about. So I think you’re right that the mindset of customers is going more consumption, and we don’t — we want to be meeting the expectations there. Jason Ader: Got you. All right. And then one quick follow-up just on that AI SKU. What is going to be included in that SKU beyond Code Suggestions? Sid Sijbrandij: Right now, we’ve only talked about Code Suggestions being part of it. Jason Ader: Perfect. Thank you. Good to see you looking good, Sid. Sid Sijbrandij: Thanks, Jason. Appreciate it. Darci Tadich: Gregg with Mizuho. Brian Robins: We don’t see him. We can go to the next one. Darci Tadich: Pinjalim with JPMorgan. Pinjalim Bora: Great. Thank you for taking the questions. Sid, good to see you doing well. Sid, maybe one on MLOps. Can you help us understand where are we in the maturity curve for GitLab with respect to MLOps. Is DataOps kind of the gap at this point? I’m trying to understand with the current craze of kind of developing Gen AI application, are you seeing new or existing customers kind of talking about using GitLab as part of their MLOps workflow when they’re thinking about building this Gen AI apps? And then one follow-up. The $9 per user per month add-on is that basically an extension into visual code? Is there a difference between a SaaS user or a self-managed user? Sid Sijbrandij: Yes. Thanks for that. So to answer the last question first, that $9 will be the same $9, whether you’re a SaaS user or a self-managed user. You’ll be able to use the Code Suggestion features in our Web IDE as well as in the usual editors like Visual Studio Code. Regarding ModelOps, we’re really, really early. So I don’t want to oversell this. It’s a vision of where we’re going to the future, of where we see the TAM expanding. Today, we have the functionality to link experiments in MLFlow to GitLab, and the next feature that will come out is a model registry. And when you have a model registry, that’s going to form the basis of new functionality we can do is then you have the model kind of control in GitLab as well, and you can start adding more functionality. We expect that MLOps functionality to come before the DataOps functionality. The model learning looks a lot more like code in many ways than the data. So it’s kind of the logical step is first models and then data. With data, it’s — we don’t have functionality yet and that will come later. I think it’s — the thing to know is that we have the ambition. We have the ambition to go beyond code. We have the ambition to manage your code, your models and your data because we think the application of the future is going to have all three, and all three are going to be governed. All three are going to have security and compliance questions that you want your tool, your DevSecOps platform to figure out for you. And that’s why we are doing this, not because it’s easy, but because it’s super, super useful, and because every application is going to have interactions between the three, if we can bring all those constituents together, that’s going to be super valuable for our customers. Pinjalim Bora: Very helpful. Thank you Darci Tadich: Next is Mike with Needham. Mike Cikos: Hey, guys. You have Mike Cikos on the line here and thank for taking the question. First one for Sid, and Sid, great to hear on the health. That’s tremendous news, and I appreciate you giving us all an update. Wanted to circle up on the AI add-on that we’ve been talking about. And I know the Code Suggestions is the only one that we’re talking to today that’s going to be part of that add-on. Can you help us think through, will GitLab be offering up AI features or certain products, however you want to phrase it, independent of that add-on? Or are you going to have to adopt that AI add-on be able to reap the benefits of the AI technology investments that you guys are making today? And then I have one follow-up for Brian. Sid Sijbrandij: Yes, it’s a great question. Like will every AI, piece of AI functionality be in that add-on? And how does it work? Will there be additional add-ons? Will it be part of Premium or Ultimate? Those are pricing and packaging questions. We’re still looking into today so I can’t comment on that. It’s a valid question though. Mike Cikos: Okay. And to Brian then, if I just look at Q1, obviously, the revenue was well ahead of the guidance and your expectations. Can you help us think through what was better than expected during the quarter? And similarly, what is management embedding in its guidance, if I look at the much more, I guess, modest sequential revenue growth that we’re now looking for in 2Q? Brian Robins: Yes. Thanks for the question, Mike. I was happy with the predictability in the quarter, as I states earlier. When we talked about guidance on the last call, because we had more variability in fourth quarter, the range got higher. And so we looked at the bottom end of the range and selected that. And so if you compare us 1Q to 4Q, sales cycles remained at 4Q levels. I did discuss how the hyperscalers bookings were over 200% year-over-year. We also had the lower discounting, and I touched on the strength of Ultimate in the quarter. And so the guidance approach hasn’t changed. When we look at the history of what we’ve done and we look at the assumptions that we have in the model, we have a very detailed bottoms-up model to come up with guidance. And we use the same guidance approach given the macro conditions, and that’s how we planned. Mike Cikos: I’ll leave it there. Thank you guys. Brian Robins: Appreciate it. Darci Tadich: Let’s try Gregg with Mizuho. He has reconnected. Gregg Moskowitz: All right. Thank you very much. Glad the connection is holding. And Sid very glad to hear the encouraging news regarding your health. I’d like to follow up on ModelOps, and I know it’s really early. I do think the native registry is an interesting enhancement. And just curious to get your expectation with regard to attracting data science teams to the platform going forward as that starts to ramp? And then I have a follow-up for Brian. Sid Sijbrandij: Yes, because it’s really early, we want them to work together hand in hand. You see that many changes need both the change in the code and a change in the models and it’s going to lead to different data being outputted. So these changes that today happen in different platform, different tool chains and sometimes very manual. We expect that it’s going to be more and more important to happen on the same level. You think about the financial industry, what you execute, what you have to prove to your auditors is going to be based on procedural code plus a model you’re running, plus that model you’re changing based on data that you need to prove like what data did you use to train the model that, that was then called from your code, that’s the questions we need to answer, that our customers need to answer, and we want to help them do that in a way that’s friction-free where it’s not up to the developers to document it each and every time but the platform just takes care of it and you only have to point out a transaction and you can immediately see how you did that. And that’s really hard to achieve today without a platform. And that’s what we’re going for. As I said very, very early, but I hope a compelling ambition. Gregg Moskowitz: All right. Very helpful. And then for Brian, in the Q4, you mentioned that your NRR decreased almost equally, I think, across seats, tier upgrades and price yield. Any change to that mix in the Q1? Brian Robins: It’s been relatively the same. And so seats is about 50%. Price increase is about 25%, and the last is 25%. So there really hasn’t been any change whatsoever. Gregg Moskowitz: All right. Perfect. Thank you. Darci Tadich: Next is Nick with Scotiabank. Nick Altmann: Awesome. Thanks, guys for taking the questions and Sid great to hear you’re doing well. Just a follow-up on Matt’s question on the Ultimate mix ticking up. It sounds like some of the strength there was driven from a business that was up for renewal in a smaller price point delta between Premium, Ultimate, and it also sounds like there was some strength there just on net new customers landing at Ultimate. But I’m just curious given there’s more renewal businesses as sort of we progressed through 2Q in the second half, should we expect the Ultimate mix to continue to uptick here? Thanks. Brian Robins: Yes. Thanks for the question, Nick. As we said before, and I think it’s worth saying again, we don’t compensate the sales team to sell Ultimate versus Premium. And so that is an output and not something that we’re solving for. We want to deliver the best solution for the customer and get them a quick time to value and a positive business outcome. And so Ultimate had strength in the quarter. It’s really driven by compliance, security and all the additional product features that Ultimate has. When you go through and look at Ultimate and look at expansion, first orders and so forth, Ultimate performed well in a lot of the categories as expected. And so where we saw some pockets of weakness was really in Premium on expansion of our existing clients as well as the contraction. Churn was relatively low, but we still saw some contraction as well. And so like I said, Ultimate had a good quarter. There was some pockets of weakness in premium, I’ll call them watch points that we continue to watch. But overall, happy with what we delivered. Nick Altmann: Great. Thank you. Darci Tadich: Our final question comes from Ryan with Barclays. Ryan MacWilliams: Thanks for squeezing me in. Sid, how are enterprises evaluating adopting AI for their code development today? So like what are some of the key items that they would grade you on? And would this happen via something like an RFP process? Or would this be something that they handle internally? Thanks. Sid Sijbrandij: Thanks. I believe it’s more organic today. They’re trying different things. I think what is really important to a lot of customers is the privacy of their code. And what they’re looking for is a provider who can guarantee that, for example, the output of the models that they ask questions to isn’t used for other models. So that’s something that’s top of mind for us as we build our features. Other than that, it also has to be kind of accessible to everyone in the company. It has to work on the most popular editors. And we have a lot of revenue from self-managed. So we want to make sure that, over time, functionality also is available to self-manage customers where they can connect to the Internet to offer that functionality. Ryan MacWilliams: So are you seeing a lot of questions from customers around securing the output of code from large language models? Sid Sijbrandij: I think it’s top of mind for customers is that the — with some of the third-party services today, you don’t get a guarantee that the output isn’t used to train the Code Suggestions for another organization. And that’s certainly top of mind for them. Ryan MacWilliams: Appreciate that. And one for Brian. Do you see any pull forward of demand or early contract negotiations from customers looking to take advantage of that $24 transition price in the quarter? Brian Robins: I’ll answer this, but this is the last one, Ryan. We got to close out and get back on the call backs. We did not allow early renewals. Your contract had to be up renewal two weeks prior to expiration. And so there was no pull forward in the quarter related to that. Ryan MacWilliams: Okay. Thanks, guys. Darci Tadich: That concludes our 1Q FY’24 earnings presentation. Thanks again, once more, for joining us. Have a great day. Follow Gitlab Inc. Follow Gitlab Inc. 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Category: topSource: insidermonkey8 hr. 41 min. ago

Top 20 Largest Cobalt Producing Countries

In this in-depth article, we’ll research the top 20 largest cobalt producing countries to see where is cobalt found in the world and which nations own the biggest chunk of the international cobalt market. If you want to skim through and find the main global cobalt producers, go to Top 5 Largest Cobalt Producing Countries.  The […] In this in-depth article, we’ll research the top 20 largest cobalt producing countries to see where is cobalt found in the world and which nations own the biggest chunk of the international cobalt market. If you want to skim through and find the main global cobalt producers, go to Top 5 Largest Cobalt Producing Countries.  The Democratic Republic of the Congo (DRC) overshadows other cobalt-producing nations. According to data extending from 2010 onwards, the DRC’s contribution to global cobalt output has been substantial. In 2022, DRC produced 68% share of worldwide cobalt production and also has the largest cobalt reserves in the world, amounting to 4 million metric tons.  Russia, Australia, the Philippines, and Cuba represent the second tier of the largest cobalt producing countries, albeit at a markedly lower production scale compared to Congo. However, their consistent efforts in cobalt mining contribute a considerable portion to the world’s cobalt supply and play an indispensable role in maintaining the balance of the metal’s availability. According to The Faraday Institution (an independent research institute in the UK), Australia, currently a comparatively minor cobalt producer, is set to experience substantial growth in cobalt production, anticipated to contribute 14% of global demand by 2030. Europe is projected to increase its cobalt production output to a noteworthy 15% of global demand by 2030, a figure particularly striking Europe’s low current cobalt production levels. The projected increase is mostly attributed to heightened efforts in cobalt recycling, alongside prospective growth in mining activities.  How Long Will Cobalt Reserves Last? As the global community transitions towards the adoption of fully electric vehicles (EVs), there is an irrefutable necessity to address the predicted surge in demand for cobalt. As per The Faraday Institution, this transition is projected to reach an annual procurement of 0.52 million metric tons of cobalt to manufacture EV batteries and other products by 2040 ( a marked increase from 170,000 metric tons per annum in 2021).  Therefore, to prolong how long will cobalt reserves last, countries need a twofold proposition: an unbroken security of the cobalt supply chain and resolving the existing issues in ethical cobalt sourcing. Recent years have seen a marked growth in research focused on improving cobalt supply chain transparency, environmental sustainability, and how is cobalt mined, and human rights practices. The Democratic Republic of Congo, having the largest cobalt production by country, is the main stakeholder in implementing environmental sustainability regarding cobalt mining.  Moving forward, it will be essential to further develop cobalt recycling and recovery processes, as well as to explore alternative, less cobalt-intensive battery technologies. The latter has already gained traction, with companies like Tesla opting for nickel-based cathodes in their new battery cells, thereby reducing their reliance on cobalt. Prominent Cobalt Mining Companies  BHP Group (NYSE:BHP) is a mining giant that has boosted its nickel mining to stand solid in the boom of electric vehicles. Since NMC (nickel, manganese, cobalt) batteries employ nickel and cobalt harmoniously, BHP Group (NYSE:BHP), being the mining giant, has built a self-sufficient nickel-sulfate plant in Perth, Australia. BHP Group (NYSE:BHP) also partnered with a Silicon Valley-based AI startup to explore battery minerals (mainly cobalt), so it can stay abreast in the electrical vehicle market.  Wheaton Precious Metals Corp (NYSE:WPM), based in Canada, is another top cobalt streamer and producer of precious metals. In 2021, Wheaton Precious Metals Corp (NYSE:WPM) finalized an agreement with Vale S.A. (NYSE:VALE) to acquire a cobalt steam from Voisey’s Bay, a nickel-cobalt-copper mine in Eastern Canada. Wheaton Precious Metals (NYSE: WPM) has also issued a 2021-2025 guidance for palladium and cobalt that averages at 810,000 GEOs. If you want more insights on WPM’s mine expansion moves and buyouts, read a detailed report we did on it here.  Vale S.A. (NYSE:VALE) is a prominent company focusing on sustainable copper mining and responsible extraction so the reserves don’t deplete in the near future. Vale S.A. (NYSE:VALE) is also deploying efforts in its cobalt streaming projects to de-risk this metal’s future exploration.  If you want to know which mining stocks are doing well financially, take a look at 11 Best Coal Mining Stocks to Buy Today to shape your investment profile.  What Is Cobalt Used For? Cobalt is a strategic metal, primarily bifurcated into two sectors: metallurgical and chemical. The metallurgical segment of Cobalt consumption is found in high-temperature alloys for sophisticated weaponry and military hardware.  Cobalt’s principal use in the chemical sector resides in the sphere of rechargeable battery production. It is paramount in manufacturing batteries for portable electronic devices, including but not limited to, mobile phones and laptop computers. Cobalt for metallurgical use is primarily in high-temperature alloys, such as aerospace rotators, defense, power generation, and steel, carbide, and diamond-based tools and magnets.  Cobalt for chemical applications is predominately used for rechargeable battery production. It serves as a significant material in batteries for mobile phones, laptop computers, and electric vehicles. Cobalt has two properties that make it ideal for battery applications. 1st, this metal has thermal stability, which is important for battery safety). Moreover, it has a high energy density that allows energy to be stored and transferred at a scale suitable for vehicle applications.  Image by Tshekiso Tebalo from Pixabay Methodology  In developing our list of the top 20 largest cobalt producing countries, we adopted a comprehensive approach based on the U.S. Geological Survey (USGS) data in its Mineral Commodity Summaries. USGS maintains the most extensive mineral databases and insights on global mine production.  The most recent data, pulled from the 2023 summary, is the cornerstone of our analysis that helped us furnish up-to-date figures to understand where is cobalt found in the world. However, for a few countries, recent data was unavailable in the 2023 summary, so the 2018 summary filled the void for these countries.  We took special care to ensure that the data from different years was made comparable and easy to refer back to.   Based on our rigorous, data-centric research, here are the top 20 largest cobalt producing countries: 20. Brazil  Cobalt Mine Production in 2019: 30 metric tons  Brazil contributed a humble amount of 30 metric tons to global cobalt production in 2019 and secured its place as the 20th largest cobalt producer worldwide. Although we don’t have documented data to show Brazil’s cobalt yield in 2022, this figure indicates that it has the capacity to mine more cobalt in the foreseeable future.  19. Zimbabwe Cobalt Mine Production in 2019: 400 metric tons  Zimbabwe churned out 400 metric tons of cobalt in 2019 and ranked 19th among the largest cobalt producers globally. Such contribution to the cobalt market highlights the nation’s pivotal role in supplying this strategic mineral widely used in batteries for electric vehicles and other high-tech industries.  18. United States Cobalt Mine Production in 2022: 800 metric tons  The lowest cobalt production, as per the USGS Mineral Commodity Summaries 2023, was in the US. Its cobalt mining production was 800 metric tons in 2022, ranking it as the 18th largest producer. The nation also maintains substantial cobalt reserves, estimated at 69,000 metric tons, that indicate better yield in the future.   17. Mexico Cobalt Mine Production in 2019: 1,100 metric tons  According to data, Mexico’s cobalt production in 2019 reached 1100 metric tons. This cobalt mine throughput places Mexico as the 17th largest global producer of this critical mineral and gives the country a stable position in the global cobalt market.  16. Finland  Cobalt Mine Production in 2019: 1,454 metric tons  Finland demonstrated substantial cobalt production capabilities in 2019 by generating an output of 1,454 metric tons. This quantity was extracted primarily from cobalt-rich nickel ores and affirmed Finland’s position as a noteworthy player in the mining sector. 15. New Caledonia  Cobalt Mine Production in 2019: 1,600 metric tons  New Caledonia produced approximately 1,600 metric tons of cobalt in 2019 from its rich lateritic nickel ore deposits, which are noteworthy for their cobalt byproduct. This output also reflects New Caledonia’s importance in supporting the escalating demand for cobalt as it’s being excessively used in EVs.  14. China Cobalt Mine Production in 2022: 2,200 metric tons  Despite being a mining giant in most metals, China’s cobalt footprint is heavily overshadowed. It produced 2,200 metric tons of cobalt in 2022 and proved to be the 14th largest cobalt production by country. China’s cobalt reserves also stand at a significant 0.14 million metric tons, which illustrates its role within the broader context of international cobalt production. 13. Morocco  Cobalt Mine Production in 2022: 2,300 metric tons  Owing to its resource-intensive mining operations, Morocco ranked 13th among the largest cobalt producing countries. Its notable mining output reached 2,300 metric tons in 2022. Such throughout is surely supported by substantial cobalt reserves of 13,000 metric tons. But based on these stats, it’s evident that the nation’s mining industry is fast-tracking its exploitation efforts.  12. South Africa  Cobalt Mine Production in 2019: 2,400 metric tons  Another major cobalt mining country we don’t see in the USGS 2023 summary is South Africa. But as per the USGS 2020 report, South Africa yielded 2,400 metric tons of cobalt in 2019. The country is the 12th largest global cobalt producer because of its substantial cache of cobalt reserves, estimated at 50,000 metric tons.  11. Turkey  Cobalt Mine Production in 2022: 2,700 metric tons Turkey bolstered its global cobalt footprint by producing 2,700 metric tons in 2022 and earned 11th rank amongst top cobalt producers. Backed by substantial reserves approximating 36,000 metric tons, Turkey’s vigorous cobalt mining industry forms an integral part of this metal’s market.  10. Zambia  Cobalt Mine Production in 2017: 2,900 metric tons  According to the US Geological Survey (USGS) 2018 data, Zambia yielded 2,900 metric tons of cobalt in 2017. This number amounts to the 10th-highest yield in cobalt mining. The country also holds cobalt reserves estimated at 0.27 million metric tons that will increase its mining yield in the near future.  9. Papua New Guinea  Cobalt Mine Production in 2022: 3,000 metric tons  Papua New Guinea has claimed a consistent share in cobalt production for the past decade. In 2022, it was the 9th largest global cobalt producer because of the 3000 metric tons of cobalt yield. Papua New Guinea’s cobalt reserves are 47,000 metric tons, which will impact this metal’s escalating demand.  8. Madagascar Cobalt Mine Production in 2022: 3,000 metric tons   Madagascar yielded 3,000 metric tons of cobalt in 2022, owing to its detailed mining operations. But despite having the same cobalt throughput as Papua New Guinea, it’s ranked 8th amongst the largest cobalt producing countries because of its reserves. According to USGS, Madagascar has 0.1 million metric tons of cobalt reserves, which makes it a more stable player in this race.   7. Philippines Cobalt Mine Production in 2022: 3,800 metric tons  The Philippines is the world’s seventh-largest cobalt producer based on its cobalt mine production of 3,800 metric tons in 2022. USGS report indicates that the country holds reserves estimated at 0.26 million metric tons that reinforce its key role in the broader spectrum.  6. Cuba Cobalt Mine Production in 2022: 3,800 metric tons  Cuba produced 3,800 metric tons of cobalt in 2022 and reached the rank of the 6th largest global producer. It has been established through rigorous analysis that Cuba hosts significant cobalt reserves estimated at 0.5 million metric tons, indicative of its potential for future production.  Click to continue reading Top 5 Largest Cobalt Producing Countries. Suggested Articles: 11 Largest Tungsten Producing Countries 16 Biggest Mining Companies in the World 15 Biggest Copper Companies in the World Disclosure: None. Top 20 Largest Cobalt Producing Countries is originally published on Insider Monkey. .....»»

Category: topSource: insidermonkey12 hr. 9 min. ago

Futures Drift Higher Despite Sharp Drop In Chinese Exports

Futures Drift Higher Despite Sharp Drop In Chinese Exports Futs are starting flat for a second consecutive day, having reversed earlier losses, after China reported a bigger-than-expected drop in exports and OECD warned of a weak global economic recovery. Shares are trying to build on Tuesday’s gains as a rally in megacap stocks that had propelled the S&P 500 to the edge of a bull market continued to fizzle. As of 8:00 am ET, S&P futures were modestly in the green at 4295 while Nasdaq 100 futs were up 0.2%The Bloomberg Dollar Spot Index traded near the day’s lows, boosting most Group-of-10 currencies. Treasury yields were little changed amid listless trading global bond markets. Oil and gold were flat, while Bitcoin retreats a day after climbing more than 5%. Today’s macro data includes mtge applications, trade balance, and consumer credit. Ultimately, the macro data prints are light for the balance of the week. In premarket trading, Apple was set to extend Tuesday’s decline, falling in premarket trade along with Nvidia and Microsoft in a signal that more air is coming out of the rally in tech shares. Tech stocks continued to decline amid growing expectations that central banks will keep rates higher for longer (at least until the next big macro print), disappointing hopes they will pivot to rate cuts later this year. Here are some other notable premarket movers: Amazon.com was upgraded to outperform from neutral at Edgewater Research, which sees a more positive outlook for the e-commerce and cloud-computing company. Shares are up as much as 0.7%. Coinbase rises 2.2% after the crypto firm slumped 12% on Tuesday following the Securities and Exchange Commission’s lawsuit against the firm. Dave & Buster’s rises 5.1% after the food and entertainment venue operator reported first-quarter earnings per share that beat estimates. Herbalife slips 0.6% as Mizuho Securities initiates coverage with a neutral recommendation, saying the long-term targets of the nutrition company are achievable, but near-term visibility is limited. Novocure Ltd. climbs as much as 5.1% as Wedbush analyst David Nierengarten raised his recommendation on the stock to neutral from underperform. Petroleo Brasileiro SA’s US-traded shares are up 2.1% after Morgan Stanley upgraded the company to overweight from equal weight and raised the price target to $16.50 from $12.50, citing “further room for capital appreciation.” Stitch Fix rises 7.3% as analysts note that the online clothing company’s better-than-expected revenue and cost-cutting measures could pave the way for better profitability. Yext Inc. rallies 18% after the infrastructure-software company boosted its adjusted earnings per share guidance for the full year. “One of the things I’m a little nervous about is that the rates market got a little too carried away about the central banks being able to quickly pre-emptively cut rates,” said Karen Ward, chief market strategist for EMEA at JPMorgan Asset Management, in an interview with Bloomberg TV. With rates markets pricing out some expected cuts, “that to me puts some of those growth, those megacap tech valuations, a little at risk,” she said. European shares wavered, with sentiment damped by a bigger-than-expected drop in Chinese exports and an OECD warning that the global economy is set for a weak recovery, dogged by persistent inflation and restrictive central bank policies. Specifically, the OECD said a global recovery that will be weaker than expected, +2.7% for FY23 and +2.9% for FY24 vs. +3.4% average over the 7 years preceding COVID; this comes amid elevated global inflation Euro Stoxx 50 falls 0.5%. FTSE MIB lags regionals, dropping 0.9%. Autos, insurance and chemicals are the worst-performing sectors. The FTSE 100 fluctuated after UK lender Halifax said the nation’s house prices posted their first annual decline since 2012. Hermes International was among the biggest drags on the benchmark, and was set to decline for the third straight session on Wednesday. Despite some hopes over potential stimulus, conviction on the China reopening trade has faltered, with sectors such as luxury goods among the hardest-hit. Here are some notable European movers: Inditex shares rise as much as 6.2% to the highest since 2017 after the Zara owner reported a 1Q earnings beat and a strong start to 2Q. Analysts see potential consensus increases after the results. Danske Bank gains as much as 5.9%, the most since October, after the Danish lender raised its key profitability target and said it will offer more than DKK50 billion in dividends by 2026. Hugo Boss rises as much as 4.1% after UBS initiated coverage with buy and a Street-high price target, noting the firm’s turnaround story. SBB climbs as much as 14%, extending the gains triggered after Friday’s surprise announcement that the beleaguered Swedish landlord would change its CEO. DiscoverIE rises as much as 4.9% after the electronic components distributor reported results which analysts say demonstrate the strength of its business model, noting the firm’s positive outlook. Assa Abloy gains as much as 4.9% after the Swedish lock and entrance systems manufacturer announced Mexican authorities gave a green light to its acquisition of hardware unit HHI. 888 Holdings rises as much as 22%, extending Tuesday’s gains, after a group of gambling-industry veterans built a stake in the owner of British betting chain William Hill. Sectra drops as much as 10% after the Swedish medical imaging company was downgraded to sell at Carnegie, with the broker saying that the stock’s valuation has again become too high. BE Semiconductor falls as much as 6.4%, extending a decline that started during Tuesday’s capital markets day, with analysts flagging a delay to a key product to 2027 from earlier 2025. PGE drops as much as 3.4% after a court in Warsaw suspended the execution of the environmental decision for the company’s Turow open-pit lignite mine, allowing it to operate until 2044. KBC dips as much as 0.7% after AlphaValue/Baader downgraded the Belgian bank to reduce as it expects margins to decline in 2024 due to rate cuts and lower loan volumes than anticipated. “Weaker global trade is not a new story but it is surprising how quickly China’s reopening boost has faded,” said Craig Erlam, a senior market analyst at Oanda. “Pressure is set to intensify on the leadership to announce new stimulus measures in a bid to revitalize the economy again.” Earlier in the session, Asian shares were mostly stronger following the positive handover from Wall St where the S&P 500 posted its highest close YTD and the Russell 2000 rallied amid strength in regional banks, although advances were capped as the attention in Asia turned to softer-than-expected Chinese trade data. Hang Seng and Shanghai Comp. were positive after reports that China asked the largest banks to cut deposit rates to boost the economy and with Hong Kong led by tech strength, while price action was less decisive in the mainland after the latest Chinese trade data mostly disappointed including the wider-than-expected contraction in dollar-denominated exports. Nikkei 225 wiped out its initial gains in an early 700-point swing and briefly dipped beneath the 32,000 level where it found some support. ASX 200 was just about kept afloat but with the upside limited by the weaker-than-expected Australian GDP and hawkish adjustments to peak rate forecasts. Indian stocks rallied for fourth consecutive day to hover around all-time high levels ahead of interest rate-setting panel’s decision on Thursday. The S&P BSE Sensex rose 0.6% to 63,142.96 in Mumbai, while the NSE Nifty 50 Index advanced 0.7% and both gauges closed a little short of their peak levels seen in December. Reliance Industries contributed the most to the Sensex’s gain, increasing 0.7%. Out of 30 shares in the Sensex index, 20 rose and 6 fell, while 4 were unchanged In FX, the Bloomberg dollar spot index gives up earlier gains. NZD and DKK are the weakest performers in G-10 FX, NOK and AUD outperform.  the Turkey lira plunged to a record low, and is the worst-performing currency against the dollar versus expanded majors, as traders said state lenders had halted dollar sales to defend it. In rates, treasuries are slightly cheaper across the curve with losses led by front-end and belly, flattening 2s10s, 5s30s spreads on the day. Stock futures remain inside Tuesday session range, while WTI crude oil futures advance over 1%. US session quiet for scheduled events, with minimal data, supply (except 17-week bills) and no Fed speakers expected.  Yields cheaper by up to 3bp across front-end of the curve with 2s10s, 5s30s spreads flatter by 0.8bp and 2bp on the day; 10- year yields around 3.685%, cheaper by 2.5bp vs. Tuesday close with bunds and gilts outperforming by 1.5bp and 3bp in the sector In commodities, WTI traded about 1% higher around $72.50 while ags appear to have caught a bid from the escalation of hostilities in Ukraine. Spot gold is little changed at $1,962/oz. Looking at today's calendar, at 7 a.m., we got the latest mortgage applications data (another drop, this time -1.4%), followed by April trade figures at 8:30 a.m and a consumer credit report at 3 p.m. The Bank of Canada will deliver a rate decision at 10 a.m. New York time. President Joe Biden will meet with his UK Prime Minister Rishi Sunak in Washington. Market Snapshot S&P 500 futures down 0.1% to 4,284.00 MXAP little changed at 163.82 MXAPJ up 0.5% to 517.07 Nikkei down 1.8% to 31,913.74 Topix down 1.3% to 2,206.30 Hang Seng Index up 0.8% to 19,252.00 Shanghai Composite little changed at 3,197.76 Sensex up 0.3% to 63,005.26 Australia S&P/ASX 200 down 0.2% to 7,117.99 Kospi little changed at 2,615.60 STOXX Europe 600 down 0.2% to 460.81 German 10Y yield little changed at 2.38% Euro little changed at $1.0686 Brent Futures little changed at $76.30/bbl Gold spot down 0.2% to $1,959.65 U.S. Dollar Index little changed at 104.16 Top Overnight News China’s May exports come in below plan, dropping 7.5% Y/Y in May (vs. the Street’s -1.8% forecast and much weaker than the +8.5% in April), although imports were a bit better (-4.5% vs. the Street’s -8%). China posts health commodity imports in May despite softer exports, with crude imports the third-highest monthly level on record. RTRS US secretary of state Antony Blinken will travel to China this month, in the latest sign that Beijing and Washington are beginning to stabilize a turbulent bilateral relationship that had sunk to the lowest point in decades. FT India expected to begin manufacturing GE jet-fighter engines in the country under a deal expected to be struck with Washington, part of New Delhi’s pivot away from Russian military equipment. WSJ The Turkish lira plunged the most in more than a year as state lenders halted dollar sales to defend it, a sign the new economic administration is giving up on costly interventions. The currency fell as much as 7.2% per dollar, weakening for a 12th day. BBG New York pushed past Hong Kong as the world's most expensive city to live in as an expat, thanks to inflation and rising accommodation costs, while skyrocketing rents saw Singapore crash into the top five for the first time. Geneva and London remained in third and fourth places, according to the ECA International's Cost of Living Rankings for 2023. BBG Michael Dell's family office plans to diversify its portfolio to absorb a payday of cash and stock worth more than $20 billion after Broadcom acquires VMware. BBG Mike Pence kicks off his presidential campaign in Iowa, with the former VP saying "different times call for different leadership." Pence is offering himself as the only traditional conservative who can win the nomination, defeat Biden and govern with more civility than Donald Trump. "Our party and our country need a leader that’ll appeal, as Lincoln said, to the better angels of our nature," he said. BBG    Wells Fargo will sell an office building in San Francisco for $42.6-46MM, a steep discount to the $108MM paid for the property back in 2005. Real Deal Reddit is cutting about 90 people, or 5% of its staff, and plans to slow hiring going forward, becoming the latest tech firm to reduce headcount. WSJ AI: Equity investors are vigorously debating the influence generative artificial intelligence (AI) may have on the future revenue growth and profitability of companies, and the valuation of stocks. We believe further upside exists to the S&P 500 index level if investors price some potential productivity and profit boost from AI adoption. Based on a range of productivity scenarios, we estimate the benefit to S&P 500 fair value could be as small as +5% vs. current levels and as large as +14%. Read Ryan Hammond and team’s full report here. A more detailed look at global markets courtesy of Newsquawk APAC stocks mostly gained following the positive handover from Wall St where the S&P 500 posted its highest close YTD and the Russell 2000 rallied amid strength in regional banks, although advances were capped as the attention in Asia turned to softer-than-expected Chinese trade data. ASX 200 was just about kept afloat but with the upside limited by the weaker-than-expected Australian GDP and hawkish adjustments to peak rate forecasts. Nikkei 225 wiped out its initial gains in an early 700-point swing and briefly dipped beneath the 32,000 level where it found some support. Hang Seng and Shanghai Comp. were positive after reports that China asked the largest banks to cut deposit rates to boost the economy and with Hong Kong led by tech strength, while price action was less decisive in the mainland after the latest Chinese trade data mostly disappointed including the wider-than-expected contraction in dollar-denominated exports. Top Asian News China Stocks Woes Hamper Hong Kong IPO Recovery: ECM Watch Blinken Plans Trip to Beijing in Bid to Stabilize US-China Ties China Traders Are Leveraging Up The Most on Record on Flush Cash Pakistan Bonds, Stocks Rise on Growing Optimism for IMF Loan China’s Steel Slowdown Pushes Exports to Highest Since 2016 Air India Sends Relief Jet to Russia for Stranded Passengers European bourses are softer, Euro Stoxx 50 -0.3%, with the complex drifting after the cash open amid a relative lack of fresh catalysts/drivers. Though, attention remains on the soft Chinese trade figures and German industrial output, on the latter ING writes that unless there is a significant pickup Germany could continue into a Q2 recession. Sectors are similarly softer though Retail names outperform amid strength in Inditex post earnings while Danske Bank is the Stoxx 600 outperformer after providing FY26 targets and a dividend update. Stateside, futures are slightly softer in-fitting with the above in similarly limited trade with the region entirely focused on next week's CPI/FOMC; though, today's BoC might provide an interim focal point, ES -0.1%. US lawmakers are reportedly attempting to curb Mastercard (MA) and Visa (V) fees, via WSJ. Top European news ECB's Schnabel says, on rates, "We have more ground to cover. It will depend on the incoming data by how much more rates will have to increase.". When questioned on market expectations for two 25bp hikes: "A peak in underlying inflation would not be sufficient to declare victory: we need to see convincing evidence that inflation returns to our 2% target in a sustained and timely manner. We are not at that point yet." ECB's de Guindos says "To complete the crisis management toolkit for large banks in the EU, we also need to make progress in other areas, such as liquidity in resolution and a backstop to the Single Resolution Fund.". ECB's Knot says prolonged monetary tightening could still result in stress for financial markets, inflation expectations in financial markets seem optimistic, not convinced that current tightening is sufficient. UK PM Sunak seeks to forge an economic alliance with US President Biden and aims to extract concessions from the US on green technologies, according to FT. FX DXY drifts on the 104.000 handle in the absence of primary US data and Fed commentary during pre-FOMC purdah. Yen relishes softer Treasury yields as USD/JPY retreats further from recent peaks towards 139.00 and decent option expiries. Yuan continues to wilt as weak Chinese trade/export metrics compound growth concerns, USD/CNY and USD/CNH top 7.1300 and 7.1400 respectively. Aussie underpinned near 0.6700 vs Greenback as RBA officials underline hawkish guidance, but AUD/USD is capped by tech resistance and hefty expiry interest. Loonie perky pre-BoC around 1.3400 handle against Buck as market pricing sits tight between pause and 25 bp hike. TRY depreciation is a strong signal of a move away from state controls in favour of a free market and declines in the CBRT's reserves have stopped after signs of FX policy change, according to traders cited by Reuters. PBoC set USD/CNY mid-point at 7.1196 vs exp. 7.1194 (prev. 7.1075) Fixed Income Bonds regroup after reversal from highs through or towards prior closing levels. Bunds, Gilts and T-notes back above parity within 134.67-07, 96.87-51 and 114-02+/113-26 respective ranges awaiting US and Canadian trade data pre-BoC. Demand for German Green Bobl exceptionally strong (record high), while 2025 UK Gilt sale reasonably well covered. Orders for the new 4yr BTP Valore retail bond reach EUR 11bln since the beginning of the offer period. Commodities Crude benchmarks are firmer and back towards post-inventory levels as the USD dips and despite overnight trade data. Currently, WTI Jul'23 and Brent Aug'23 post upside of around USD 0.50/bbl; newsflow has been limited and focused on geopols and while IEA's Birol spoke he added little aside from looking for a tight H2. US Energy Inventory Data (bbls): Crude -1.7mln (exp. +1.0mln), Gasoline +2.4mln (exp. +0.9mln), Distillate +4.5mln (exp. +1.3mln), Cushing +1.5mln. Base metals are modestly firmer and largely shrugged off Chinese trade as the import metrics seemingly indicate the overall reopening-recovery narrative remains in play. Spot gold is little changed as the USD pulls back to near-U/C with the yellow metal holding above the USD 1956/oz 10-DMA but unable to make much headway from session high circa. USD 10/oz above. Discussions on the Black Sea grain deal to occur in Geneva on Friday, via Ria citing sources. Indian Steel Minster says they are looking aggressively to diversify coking coal imports, requirement for this product is going to increase. Crypto Binance commented on the US SEC filing a motion to freeze assets in which it stated that user assets remain safe and its platform continues normal deposit and withdrawal operations, while it added that the filing of the preliminary injunction is unwarranted and it looks forward to defending against it in court, according to Reuters. Coinbase (COIN) says the incident with delayed ETH transactions has been resolved. Geopolitics US Secretary of State Blinken and Saudi Crown Prince MBS had an open and candid discussion covering a full range of bilateral issues, while there was a good degree of convergence in the meeting but also differences. Furthermore, they discussed the potential for normalisation of relations between Saudi Arabia and Israel, as well as agreed to continue dialogue on normalisation, while Blinken raised human rights issues with MBS both generally and related to specific cases, according to a US official. US Secretary of State Blinken is set to travel to China for talks in the coming weeks in a visit intended to be a major step in thawing relations between the two countries, according to Reuters citing a US official. EU nations are approaching a deal on the 11th sanctions package against Russia. Representatives in Brussels are aiming to get the package over the line at their meeting today. EU diplomats suggest that several questions are still open, according to Politico. Number of IAEA inspectors at the Zaporizhzhia nuclear plant to increase several times, via Tass citing Russia's Rosenergoatom. US Event calendar 07:00: June MBA Mortgage Applications, prior -3.7% 08:30: Revisions: US Trade in Goods and Services 08:30: April Trade Balance, est. -$75.8b, prior -$64.2b 15:00: April Consumer Credit, est. $22b, prior $26.5b DB's Jim Reid concludes the overnight wrap Today is the day where I see whether I need to start the training clock for the 2036 Olympics as my daughter Maisie has her first ever swimming gala. It's only against a couple of schools so if she wins her race the dream is still on and if she doesn't I'll conclude that unless we have all the global medalists for 2036 in the same 5 mile catchment area in Surrey then it's probably not going to happen. Last week she swam 6 times!! If anyone can explain how you can have any kind of life with a full time job and 3 kids with various sporting commitments and parties then I'd love to know. I didn't see my wife in the evenings last week or last weekend with all the ferrying. All answers gratefully received. Markets are generally swimming slightly against the tide this week, with the S&P 500 (+0.22%) still not quite able to break out into bull market territory that it crossed intra-day on Monday. Having said that the index did just about close at a high for 2023 so the momentum is still there to some degree. In a week of limited data and a Fed blackout there have been a few stories swirling around in the background that have dampened sentiment without reversing it. That has included geopolitical risks, weak data releases, as well as growing scepticism that the Fed would end up cutting rates this year. In fact, by the close yesterday, the 2s10s curve had inverted to a post-SVB low of -82.3bps, which just demonstrates how various recessionary indicators are still flashing with growing alarm. The newsflow was pretty subdued from the outset yesterday, and shortly after we went to press German factory orders unexpectedly contracted by -0.4% in April (vs. +2.8% expected). This echoed the signals in the latest manufacturing PMI for May, which hit a 3-year low of 43.2, as well as the data revisions a couple of weeks ago that Germany did experience a winter recession after all. That weak data interacted with further geopolitical concerns, particularly after the Kakhovka dam in Ukraine was destroyed, which has led to serious flooding in southern Ukraine. A key concern is with regard to the Zaporizhzhia nuclear plant, which relies on water supplies to cool its reactors, but experts didn’t consider a nuclear incident likely. From a market perspective, the bigger concern could well be the impact on agricultural prices and hence inflation, with wheat prices (+0.52%) recording a 5th consecutive daily increase, although having pared back earlier gains when it had been up as much as +3.85%. As it happens, we flagged in our World Outlook on Monday (link here) that a widely-predicted El Nino event this year was a risk to the trend of declining food prices over recent months, so events like that and the Ukraine flooding could provide an additional inflationary impulse as growth slows. You could add in bubbling concerns about low water levels at the lake that feeds the Panama Canal to that list of supply side concerns. The Panama Canal Authority is predicting a record low water level for the end of July with weight limits and rising surcharges already in force. So one to watch in the weeks ahead. On the theme of geopolitics/supply chains, this morning Marion Laboure and Cassidy Ainsworth-Grace on my team have published an update on the landscape for semiconductors and rare earth metals (link here). It’s a topical story, since yesterday saw Japan announce a revised chips strategy that has the goal of tripling sales of Japanese-produced semiconductors by 2030. And that follows China’s announcement in late-May that Micron’s products had failed its cybersecurity review, saying that it posed “relatively serious” cybersecurity risks. It also comes amidst a growing push towards more resilient supply chains, which was one of the themes at last month’s summit of G7 leaders. Back to markets and risk assets were fairly steady on the whole, and the S&P 500 (+0.22%) posted only a very modest gain. Banks (+1.84%) were the main outperformer in the index, whilst the megacap tech stocks continued to strengthen, with the FANG+ Index (+0.56%) taking its YTD gains up to +67.53% by the close. With equities grinding higher, equity volatility hit a new local low as the VIX index closed under 14.0pts (13.96) for the first time since February 2020. Small cap stocks strongly outperformed with the Russell 2000 index +2.73% higher, which was its second best day since November with the only better day being last Friday. European equities also recovered from their Monday losses, with the STOXX 600 up +0.38%. When it came to sovereign bonds, there was a mixed performance on either side of the Atlantic. US Treasuries were flat, with the 10yr yield unchanged at 3.683%. That comes with just a week to go until the Fed’s next decision, where markets are still pricing in a temporary pause as the most likely outcome, which would be a big milestone after a run of 10 consecutive rate hikes. But it was a different story in Europe, where yields on 10yr bunds (-3.0bps) and OATs (-0.6bps) both moved lower. In part, they were supported by the ECB’s latest Consumer Expectations Survey for April, which showed that median 1yr inflation expectations were down to 4.1%, which is their lowest since February 2022 when Russia’s invasion of Ukraine began. Asian equity markets are mixed this morning after erasing their opening gains after China’s May trade data disappointed (more on this below). As I check my screens, the rally in Japanese stocks has paused for breath after recently hitting 30yr plus highs with the Nikkei sliding -1.44% and leading losses across the region. Mainland Chinese markets are also struggling with the CSI (-0.34%) trading in the red and the Shanghai Composite (+0.02%) surrendering its opening gains. Elsewhere, the Hang Seng (+0.94%) is moving higher with the KOSPI (+0.32%) also seeing a positive start after coming back from a public holiday. In overnight trading, US stock futures tied to the S&P 500 (+0.01%) are flat. Coming back China, the data showed that exports (-7.5% y/y) fell in May for the first time since February, much faster than the market expected drop of -1.8%, after a gain of +8.5% in the preceding month. Meanwhile, imports declined at a slower pace, dropping -4.5% y/y in May (v/s -8.0% expected; -7.9% in April). The call for fresh stimulus is mounting. Elsewhere in Australia, Q1 GDP expanded +2.3% y/y, slightly below market expected growth of +2.4% and against a downwardly revised expansion of +2.6% in the final quarter of 2022. On a q-o-q basis, GDP grew by just +0.2% in the March quarter, the smallest increase since the nation emerged from the Covid lockdown in September 2021 and compared with a rise of +0.3% expected before today's announcement. Staying with growth, the World Bank released their latest global outlook yesterday, which pointed to growth of +2.1% in 2023, up by four-tenths relative to their January forecast. However, they revised down their 2024 forecast by three-tenths to 2.4%. Looking out to 2025, they then see growth accelerating back up to +3.0%. Otherwise, Euro Area retail sales were unchanged in April (vs. +0.2% expected), although the previous month’s contraction was revised up to show a smaller -0.4% decline. To the day ahead now, and data releases include German industrial production and Italian retail sales for April, along with the US trade balance for April. Otherwise, the Bank of Canada will be making its latest policy decision, and we’ll hear from ECB Vice President de Guindos, and the ECB’s Knot, Panetta and Vujcic. Lastly, the OECD will be releasing its latest Economic Outlook, and UK PM Sunak will be visiting US President Biden in Washington. Tyler Durden Wed, 06/07/2023 - 08:11.....»»

Category: personnelSource: nytJun 7th, 2023

Salesforce, Inc. (NYSE:CRM) Q1 2024 Earnings Call Transcript

Salesforce, Inc. (NYSE:CRM) Q1 2024 Earnings Call Transcript May 31, 2023 Salesforce, Inc. beats earnings expectations. Reported EPS is $1.69, expectations were $1.61. Operator: Welcome to Salesforce Fiscal 2024 First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. [Operator Instructions] I would like to hand over the […] Salesforce, Inc. (NYSE:CRM) Q1 2024 Earnings Call Transcript May 31, 2023 Salesforce, Inc. beats earnings expectations. Reported EPS is $1.69, expectations were $1.61. Operator: Welcome to Salesforce Fiscal 2024 First Quarter Results Conference Call. All lines have been placed on mute to prevent any background noise. [Operator Instructions] I would like to hand over the conference to your speaker, Mike Spencer, Executive Vice President of Investor Relations. Sir, you may begin. Mike Spencer: Good afternoon and thanks for joining us today on our fiscal 2024 first quarter results conference call. Our press release, SEC filings, and a replay of today’s call can be found on our website. With me on the call today is Marc Benioff, Chair and CEO; Amy Weaver, President and Chief Finance Officer; and Brian Millham, President and Chief Operating Officer. As a reminder, our commentary today will include non-GAAP measures. Reconciliations between our GAAP and non-GAAP results and guidance can be found in our earnings and press release. Some of our comments today may contain forward-looking statements and are subject to risks, uncertainties, and assumptions, which could change. Should any of these risks materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. A description of these risks, uncertainties, and assumptions and other factors that could affect our financial results is included in our SEC filings, including our most recent report on Forms 10-K, 10-Q, and any other SEC filings. Except as required by law, we do not undertake any responsibility to update these forward-looking statements. And with that, let me hand the call to Marc. Marc Benioff: Thanks, Mike, and thank you all for being on the call. On our last call in March, we told you about how Salesforce had radically accelerated our transformation to profitable growth. We share with you how we hit the hyperspace button across the key areas of our transformation, restructuring for the short and long-term, reigniting our performance culture by focusing on productivity, operational excellence, and profitability, prioritizing our core innovations that drive customer success, building even stronger relationships with you, our investors. Our Q1 results show that we continue to make great progress. As I said in March, we’re just getting started with this incredible transformation. We continue to scrutinize every dollar investment, every resource, and every spend and we’re transforming every corner of our company. Our progress over the last 5 months, while it’s very impressive and I cannot be more grateful to our entire team for their leadership. In fact, you may hear me say that several times on this call. Our transformation drove our Q1 financial results. As I said, on our last call, well improving profitability is our highest priority. As a result, we significantly exceeded our margin target for the quarter, delivering a non-GAAP operating margin of 27.6%, up 1,000 basis points year-over-year, incredible. And there’s no greater point of evidence to our transformation than this amazing result following the tremendous operating margin Q4. In Q1, we delivered 8.2 billion in revenue, up 11% year-over-year and 13% in constant currency. We had some amazing wins in the quarter with Northwell Health, Paramount, Siemens, Spotify, NASA, and the U.S. Department of Agriculture, among others. We delivered 4.5 billion in operating cash flow up 22% year-over-year. Our remaining performance obligation ended the quarter at 46.7 billion, an increase of 11% year-over-year. And through Q1, we’ve now returned more than $6 billion in share repurchases. As a result for the third quarter in a row, we ended the quarter with fewer shares year-over-year another amazing point of evidence on this incredible transformation. Now, turning to our financial guidance, while the economy is not in our control, our margins are, which is why we’re raising our margin target for the full fiscal year. For FY 2024, we’re raising our non-GAAP operating margin to 28%, an improvement of 550 basis points year-over-year and we remain confident that we’ll hit 30% non-GAAP operating margins in the first quarter of fiscal year 2025. We could not be more excited about our progress. We’re maintaining our fiscal year 2024 revenue guidance of approximately 34.5 billion to 34.7 billion over 10% projected growth year-over-year. I couldn’t be more proud of how our team has come together, stepped up, and delivered these results. I’ve also been asked numerous times this quarter by our investors and our customers, how we’re able to make so much progress so fast and deliver these incredible numbers? It’s very simple. It’s our Ohana culture. It’s our superpower. And again, I’d like to thank our amazing team for this incredible accomplishment. Last quarter, I told you of how our AI team is getting ready to launch Einstein GPT, the world’s first genitive AI for CRM. At TrailheadDX in March in front of thousands of trailblazers here in San Francisco, that’s exactly what we did. At its foundation, Einstein GPT is open and extensible. Customers can connect to multiple large language models, including from partners like OpenAI and Tropic and others. This is a whole new way to work for our customers, users, and trailblazers. Users on Salesforce are seeing new AI generative features across all of their most common workflows. And while many of these will be created by Salesforce developers, far more will be created by our incredible trailblazer ecosystem. For low code of trailblazers, Einstein GPT will provide a toolset to design generative AI apps built on [reusable props] [ph]. For pro code trailblazers, Einstein GPT will offer an extensible ecosystem of LLM providers with configurable grounding. And Einstein GPT is the combination of tremendous research and engineering by our world-class AI team, and I’d like to congratulate them on this amazing result. And one more amazing result, this week, Einstein, Salesforce Einstein that we’ve been talking about for so many years on these calls, will generate an incredible 1 trillion predictions for our customers, an incredible milestone on our AI journey. We saw more of the incredible work of our AI team at our New York City world tour this month when we demonstrated Slack GPT. Slack is a secure treasure trove of company data that generative AI can use to give every company and every employee their own powerful AI assistant helping every employee be more productive and transforming the future work. Slack GPT can leverage the power of generative AI to deliver instant conversation summaries, research tools, and writing assistance directly in Slack, and you may never need to leave Slack to get a question answered. Slack is the perfect conversational interface for working with LLMs, which is why so many AI companies are Slack first and why OpenAI, ChatGPT, and Anthropic Squad can now use Slack as a native interface. Slack is also delivering integrated sales and service experiences powered by native GPT to be the best interface for all of our Salesforce customers and there’s a lot more magic to come with Slack and generative AI. In this month, we also announced Tableau GPT. At our Tableau conference, we had over 8,000 in-person attendees. Tableau GPT simplifies data analysis for all of our users enabling anyone to inquire about their data using Einstein GPT and obtain AI driven insights at scale. The intelligence and automation that Tableau GPT provides is tremendously important in this area of hyperscale data that we’re all entering. The coming wave of generative AI will be more revolutionary than any technology innovation that’s come before in our lifetime or maybe any lifetime. Like Netscape Navigator, which opened the door, to a greater Internet, a new door has opened with generative AI and it is reshaping our world in ways that we’ve never imagined. Every CEO realizes they’re going to have to invest in AI aggressively to remain competitive and Salesforce is going to be their trusted partner to get them to do just that. Every CEO I’ve spoken with sees AI as a revolution beginning and ending with the customer, and every CIO I’ve spoken with wants more productivity, more automation, and more intelligence through using AI. A great example [of deploying] [ph] this technology is Gucci. We’re working with them to augment their client advisors by building AI chat technology that creates a Guccified [indiscernible] service, well, incredible new voice, amplifying brands, storytelling and incremental sales as well. It’s an incredibly exciting vision for generative AI to transform which was customer service into now customer service, marketing, and sales, all through augmenting Gucci employee capabilities using this amazing generative AI, but we can only do all of this with trust. Our customers need to understand where their data is going and they must be able to maintain data integrity and access and privacy controls. Large customers must maintain data compliance as a critical part of their governance, while using generative AI and LLMs. This is not true in the consumer environment, but it is true for our customers, our enterprise customers who demand the highest levels of this capability. Where customers who for years have used relational databases as the secure mechanism of their trusted data, they already have that high level of security to the row and sell level. We all understand that. And that is why we have built our GPT trust layer into Einstein GPT. The GPT trust layer gives connected LLM secure real time access to data without the need to move all of your data into the LLM itself. It’s an incredible breakthrough for our customers and working with LLMs in a secure and trusted way. While they’re using the LLMs, the data itself is not moving and being stored in the LLM. That is what our customers want. They can be sure that the customer data is where they know it is, where they can be assured that it is for their compliance and for their governance. And I cannot be more excited about our AI CRM and delivering on this future of trusted AI through our new Salesforce GPT trust layer. Finally, I can’t talk about AI without talking about the success of our data cloud. Data Cloud is the heart of customer 360 and now our fastest growing cloud ever. Data Cloud created a real-time Intelligent Data Lake that brings together and harmonizes all of our customers’ data in one place. In Q1, we closed one of our largest healthcare industry deals ever with Northwell Health, New York’s largest private employer. They have 21 hospitals, 900 patient – 900 outpatient facility or ambulatory facilities, and their own medical school all in New York. By integrating DataCloud with Health Cloud, Tableau, MuleSoft, while our entire customer 360, Northwell is improving patient care by bringing together its vast data resources to create a single source of truth and using AI to govern data, use, and maintain regulatory compliance. This is the future of our customers and our industry. It’s AI, plus data, plus CRM. And of course, this AI revolution is just getting started, which is why we’ve invested 250 million in our new AI venture fund to fuel startups developing our trusted generative AI vision. We’ll be talking more about this at our AI Day event on June 12th in New York City, and I hope that you’ll join me there. To wrap up, we’re transforming every corner of our company. We’re laser focused on our short-term and long term restructuring, improving productivity and performance, prioritizing our core innovations and delivering for our shareholders. As a result, productivity is up, profitability is up, revenue is up, cash flow is up, and we dramatically increased our margin guidance. And just like the cloud, mobile and social well, AI, this revolution is a new innovation cycle. It’s going to be a new spending cycle as well, which is going spark a massive new tech buying cycle. And we’ve led the industry through each of these cycles and I couldn’t be more excited for our future as we continue on a path to our long-term goal to make Salesforce the largest most profitable enterprise software company in the world, and the number 1, safest and most trusted AI CRM. With that, Brian, I’ll turn it over to you. Brian Millham: Thanks, Marc. As Marc said, we’re continuing our transformation across every part of our company. Our focus on performance culture and operational excellence contributed to our strong first quarter results. Since our last call, we’ve removed layers to get closer to our customers and to complexity out of our business to help us accelerate through the rest of the year. We clearly defined our return and remote office guidelines for our employees, and it’s been great to get together even more in our offices and with our customers around the globe. I had the chance to visit [many of our office] [ph] this quarter and the energy is incredible. As you heard from Marc, our transformation plan continues to deliver top and bottom line growth as we help our customers increase productivity, drive efficiency, and become AI First Companies. But we’re still operating in an uncertain macro environment. Customers continue to scrutinize every deal, and we see elongated deal cycles and deal compression, particularly in our more transactional revenue streams like SMB, create and close, and self-serve. Also in Q1, our professional service business started to see less demand for multi-year transformations, and in some cases delayed projects as customers focused on quick wins and fast time to value. But for this reason, we saw strong performance from some of our fast time to value efficiency focused products with sales performance management, sales productivity, and digital service all growing annual recurring revenue above 40% in the quarter. As customers look to reduce complexity and achieve faster time to value, they’re expanding their adoption of Salesforce clouds, a key growth strategy for us. The world’s most recognized companies are relying on Salesforce more than 90% of the Fortune 100 used Salesforce and they average more than five of our clouds. This is why we’re so excited about our AI plus data plus CRM strategy. As Marc explained, we’re building Einstein GPT and Data Cloud into every cloud and our Customer 360 and we’re perfectly positioned to help our customers harness the phenomenal power of AI. Our core offerings remain resilient. In Q1, 9 of our top 10 deals included sales, service, and platform. Industry clouds continue to be a tailwind to our growth, and we saw momentum with great customers like Northwell, USDA Rural Development, and NASA who we showcased at World Tour DC in April. Once again, eight of our industry clouds grew ARR above 50%. I met with hundreds of customers in the quarter and we hosted 700 meetings in our innovation centers with our top customers and prospects. Generative AI is top of mind for all of them. As they look to benefit from the intelligence automation and cost savings that Salesforce is uniquely positioned to deliver. We’re seeing tremendous appetite for our new generative AI products starting with Einstein GPT, Slack GPT, and Data Cloud. Our generative AI products will be a catalyst for our future growth. As Marc mentioned, Data Cloud continues to be one of our fastest growing products and we had great wins in the quarter with companies like Major League Soccer and Giorgio Armani. Armani uses Data Cloud to deliver hyper personalized online and in-store experiences, real time engagement, and curated shopping recommendations. We can see how Data Cloud and Einstein GPT are going to create experiences that weren’t possible before and really drive growth. In an environment where customers are optimizing their current [tech stacks] [ph], integration and automation continue to be efficiency drivers. MuleSoft again delivered strong results with wins at Siemens, [Cinnova] [ph], and Vodafone. For the first time, Salesforce was ranked number 1 in integration by market share in the latest IDC software tracker, a great testament to our MuleSoft team. Tableau is unleashing the power of our Data Cloud, unlocking customer data and delivering actionable real time insights. In the quarter, we had great wins at customers like Union Bank of the Philippines, Discovery Financial Service, Moderna, ADT Solar, and Alaska Air. We’ve made great investments to reaccelerate Tableau, including new leadership along with product innovations like Tableau GPT, and revenue intelligence, now one of our fastest growing add-ons. I’m really encouraged by the Slack team who has created an ambitious product roadmap with generative AI at the center. In Q1, we saw amazing momentum with customers like the California Office of Systems Integration, Paramount Global, Breville, and OpenAI, and rolled out an AI ready platform, Slack Canvas, and app integrations with ChatGPT in Anthropic’s Claude. Overall, I could not be more thrilled with our offerings and the market position, especially as it relates to delivering on the promise of AI. We’re looking forward to continuing the energy and momentum at our AI day in just a couple of weeks. I’m very proud of the teams and of our partners. Their focus on customer success continues to be outstanding. As Marc said, our productivity is up, profitability is up, revenue is up, cash flow is up. We’re increasing our margin guidance and sales forces leading the way as the number one AI CRM. Now, over to you Amy. Amy Weaver: Thank you, Brian. As Marc said, a key part of our transformation to profitable growth is short and long-term restructuring of the company. We have now largely completed the restructuring announced in January, and we’re completing our comprehensive operating and go to market review. As we shift to the implementation phase, we’re executing against three key pillars, optimization of resources and organization structure, product investment prioritization, and operational rigor. We continue to view sales and marketing and G&A as the primary drivers of leverage. While R&D remains an important investment area. Our profitable growth framework, disciplined capital allocation strategy, and opportunity to drive shareholder value are represented in our actions and in our results. Now, turning to our results for Q1’s fiscal year 2024, beginning with top line commentary. For the first quarter, revenue was 8.2 billion, up 11% year-over-year or 13% in constant currency with the beat primarily driven by strong momentum in MuleSoft, and more resilient core performance. Geographically, we saw strong new business growth in parts of EMEA and LatAm, specifically Switzerland, Italy, and Brazil, while we experienced continued pressure in the United States. In Q1, the Americas revenue grew 10%, EMEA grew 12% or 17% in constant currency. And APAC grew 16% or 24% in constant currency. From an industry perspective, manufacturing, automotive, and energy all performed well, while high-tech and financial services remained under pressure. Q1 revenue attrition ended the quarter at approximately 8%. As expected, we saw a modest increase in Q1. Partially attributed to the inclusion of Tableau in the metric. We also noted some incremental weakness in our marketing and commerce attrition. As Marc said, non-GAAP operating margin finished strong in Q1 at 27.6%, driven by our disciplined investment strategy and accelerating our restructuring efforts. Q1 operating cash flow is 4.5 billion, up 22% year-over-year. This includes a 910 basis points headwind from restructuring. Q1 free cash flow was 4.2 billion, up 21% year-over-year. Turning to remaining performance obligation or RPO, which represents all future revenue under contract. This ended Q1 at 46.7 billion, up 11% year-over-year. Current remaining performance obligation or CRPO, ended at 24.1 billion, up 12% year-over-year in both nominal and constant currency, ahead of expectations driven by strong core performance, partially offset by continue, create, and close softness. And finally, we continued to deliver on our capital return commitment. In Q1, we returned 2.1 billion in the form of share repurchases bringing the total returned to more than 6 billion since the program was initiated last August, representing more than 38 million shares. Before moving to guidance, I wanted to briefly touch on the current macro environment that Brian discussed. The more measured buying behavior persisted in Q1. And as Brian noted, in Q1, we started to see weakness in our professional services business. We expect these factors to persist, which is incorporated in our guidance. Let’s start with fiscal year 2024. On revenue, we are holding our guidance of 34.5 billion to 34.7 billion, representing over 10% growth year-over-year in both nominal and constant currency. The strength in our Q1 performance is offset by the pressure in our professional services business previously discussed. For fiscal year 2024, we are raising non-GAAP operating margin guidance to 28%, representing a 550 basis points improvement year-over-year. This guidance increase is driven by the acceleration of our restructuring efforts and also includes reinvestment in targeted areas, namely in R&D. I’m proud of our progress and remain confident in our trajectory as we progress towards our 30% non-GAAP operating margin target in Q1 2025. We also remain focused on stock based compensation and continue to expect it to improve this year to below 9% as a percent of revenue. Before moving to EPS, on restructuring, we now expect the charges in FY 2024 to come in towards the higher end of the range previously provided in our last earnings release. As a result of these updates, we now expect fiscal year 2024 GAAP EPS of $2.67 to $2.69, including estimated charges for the restructuring of a $1.11. Non-GAAP EPS is now expected to be $7.41 to $7.43. And we are raising our fiscal year 2024 operating cash flow growth to be approximately 16% to 17%, which now includes a 14 point to 16 point headwind from restructuring. As a reminder, we will see an increase in our cash taxes in fiscal 2024 as we draw down our remaining net operating losses. CapEx for the fiscal year is expected to be slightly below 2.5% of revenue. This results in free cash flow growth of approximately 17% to 18% for the fiscal year. Now to guidance for Q2. On revenue, we expect $8.51 billion to $8.53 billion, growth of approximately 10% in both nominal and constant currency. CRPO growth for Q2 is expected to be approximately 10% year-over-year in nominal and constant currency. Our guidance incorporates the momentum of our execution in Q1, offset by the persistent measured buying behavior and a decline in professional services fixed fees contribution. The professional services impact represents approximately a 1 point headwind to growth. For Q2, we expect GAAP EPS of $0.79 to $0.80 and non-GAAP EPS of $1.89 to $1.90. And as we focus on shareholder return and disciplined capital allocation, we continue to expect to fully offset our stock based compensation dilution through our share repurchases in fiscal year 2024. In closing, we continue to transform every corner of the company. We are hyper focused on delivering the next wave of innovation led by Data Cloud and Einstein GPT. And Salesforce is well-positioned to remain the market leader in this new AI first world. We are committed to delivering long-term shareholder value, and I personally want to thank our shareholders for their continued support. Now, Mike, let’s open up the call for questions. Mike Spencer: Thanks, Amy. Operator, we’ll move to questions now. I ask that everyone only ask one question in respect for others on the call. In addition, I’d like to introduce Srini Tallapragada, our Head of Engineering, who will be joining us for Q&A today. With that Emma, let’s move to the questions. Q&A Session Follow Salesforce Inc. (NYSE:CRM) Follow Salesforce Inc. (NYSE:CRM) We may use your email to send marketing emails about our services. Click here to read our privacy policy. Operator: Thank you. [Operator Instructions] Your first question today comes from the line of Kirk Materne with Evercore. Your line is open. Kirk Materne: Hi, yes. Thanks very much and congrats on a good start to the year. Marc, you’ve been through a number of cycles from a technology perspective. I was just kind of curious where you think we are in terms of people investigating AI versus when the spending cycle around it might kick-in? Can you just give us an idea of, you know, sort of your thoughts on that and really just the opportunity for you all to monetize AI with your product base? Thanks. Marc Benioff: Well, I think this is the absolute question of the day, which is we are about to enter an unbelievable super cycle for tech and everyone can see that. This is an incredible opportunity for not only Salesforce, but our entire industry. I mean, perhaps only a year ago or less than a year ago, no one on this call even knew what GPT was. Today, ChatGPT is the fastest growing consumer product of all time, and has transformed many, many lives. It’s definitely not just the technology of this lifetime, but maybe any lifetime. It’s an incredible technology. And every company is going to have to transform because every company is going to have to become more productive or automated more intelligent through this technology to be competitive with other companies. And just yesterday, I’m in a room here at the top of Salesforce Tower on the 60th floor, and we have the CEO of a very large bank here. And like every other sales call I’ve made in the last quarter, there’s only one thing that customers want to talk about, and that’s artificial intelligence and specifically, generative AI. Of course, we have been a leader in this area with Einstein, more than 1 trillion transactions delivered this week, but these are primarily predictive transactions built on machine intelligence, machine learning, and deep learning. But in 2018, deep learning evolved and became much more sophisticated and became generative as these neural networks expanded their capabilities and also the hardware went to another level as well. So, now we have this incredible new capability. It’s a new platform for growth, and I couldn’t be more excited. But yesterday, there were many questions from my friend who I’m not going to give you his name because he’s one of the – the CEO of one of the largest and most important banks in the world. And I’ll just say that, of course, his primary focus is on productivity. He knows that he wants to make his bankers a lot more successful. He wants every banker to be able to rewrite a mortgage, but not every banker can, because writing the mortgage takes a lot of technical expertise. But as we showed him in the meeting through a combination of Tableau, which we demonstrated and Slack, which we demonstrated, and Salesforce’s Financial Services Cloud, which he has tens of thousands of users on, that banker understood that this would be incredible. But I also emphasize to him that LLMs, or large language models, they have a voracious appetite for data. They want every piece of data that they can consume, but through his regulatory standards, he cannot deliver all that data into the LLM because it becomes amalgamated. Today, he runs on Salesforce, and his data is secure down to the row and cell level. He knows that readers don’t block [riders] [ph] that there’s all types of security provisions and regarding who can see what data about what account or what customer. And when you put it into an LLM, those permissions are not understood. So, that is a very powerful moment to realize that the way that LLMs operate is in a way state where they’re kind of consuming all this data and then giving us that information back out, well, that Salesforce’s opportunity. That’s why we built this GPT trust layer. And through the GPT trust layer and rebuilding all of our apps, including Slack and Tableau, but as we demonstrated him yesterday, a new Sales Cloud, a new Service Cloud, a new marketing cloud, and what we’ll show on June 12 in New York City, a complete reconceptualization of our product line. What that means for this customer and for every customer is that they have an opportunity to transform their business. And for Salesforce, that also means an opportunity to transform ourselves and for our industry, a new super cycle where every company will have to transform to be AI first. Operator: Your next question comes from the line of Keith Weiss with Morgan Stanley. Your line is open. Elizabeth Porter: Great. This is Elizabeth Porter on for Keith Weiss. Thanks for the question. I wanted to ask on the potential disruption from rebooting the sales enablement process. Are we past the point of seeing disruption or could that be a future risk? And if so, how is it included in guidance. The CRPO guidance for 10% looks like a bit of a slowdown despite the easier comp. And Amy, you called out pro services a one-point headwind. But just any other factors we should keep in mind that may create a challenge over the next couple of months? Thank you. Marc Benioff: Well, I’ll tell you that. I think that as you know, in Q1, we went through tremendous disruption with human resources in our company, and it was very disruptive to all of our Ohana. And I’m so grateful to them for how they supported the whole company, all the customers and themselves during what was probably one of the most disruptive quarters that I’ve seen and yet we delivered these incredible numbers and this incredible technology vision going forward. In terms of enablement of the sales organization, its ability to kind of move forward, that is not, I would say, a material part of what happened in the quarter or what’s going to happen for the year. Our sales organization remains with a very high level of productivity, but let me turn it over to Brian to speak directly to his strategy on delivering the year. Brian Millham: Yes, Marc, thank you. I appreciate it. And Elizabeth, thank you for the question. I think you’re referencing some comments we made on previous calls about enablement being an important strategy for us as we saw during the pandemic, not as many of our AEs and SEs and leaders were as enabled as we would like. We’ve made those changes, and we’ve really invested in the time to make sure our AEs understand our product portfolio, the entire customer 360, and we’re on sort of the next generation of enablement. As Marc just talked about, this new AI wave is going to create a huge opportunity for us. And we need to make sure that we’re investing in the enablement to bring our teams along. It’s been a very short window around this innovation, and we’ve got some work to do on this, but we’re very, very excited with our path forward, our position in the market. All that we’re doing with our customers, the demand we’re feeling from our customers. Marc mentioned it, and I had the same experience, every CEO in the world is talking to us about generative AI right now, and we are investing heavily to make sure our account executives, our sales teams, in fact, the entire company is able to articulate our value proposition to our customers. So, Amy, I don’t know if you have any further comments there? Amy Weaver: Sure. Elizabeth, you mentioned CRPO in professional services, so let me jump in on that. For our guide for this next quarter, we are seeing some pressures from the macro situation and then also specifically from professional services. And there’s a bit of a nuance with ProServ that I want to make sure people understand. So, if you back up, our customers can contract for professional services in two ways, either on a time and materials basis, which is typically used for smaller projects or on a fixed fee, kind of milestone basis. For purposes of CRPO, we only include projected revenue from fixed fee deals. One of the things that we are seeing right now is not only a professional services as a whole same pressure, but more customers are choosing to contract on a time and materials basis, which is not included in our CRPO. So, as a result, we’re seeing, kind of a double pressure there. And I’m expecting a full one-point headwind to CRPO for the quarter from professional services. Mike Spencer: Thanks Elizabeth. Emma, let’s move to the next question please. Operator: Your next question comes from the line of Brad Sills with Bank of America. Your line is open. Brad Sills: Oh, wonderful. Thanks. I wanted to ask a question to Brian, I think, here on the efforts here to improve productivity. You mentioned removing some layers here. My question is, we think of all these actions that you’re taking as drivers of margin expansion, but are you starting to see some early traction here on the sales productivity front, such that perhaps that’s driving some upside here across the business, perhaps larger deals now that you’re seeing coming out of the field and pipeline and some of the deal closure? Thank you so much. Brian Millham: Thanks, Brad, for the question. I really appreciate it. As you know, we’re operating in a constrained environment right now. And so, we are really focused on this productivity measure and metric for our organization right now, investing heavily, as I mentioned earlier, and the enablement part of our organization. Also looking at other ways to drive productivity. And one of the things that we’re talking quite a bit about right now is pricing and packaging, bringing together logical products that we can be selling in a single motion versus our go-to-market, which is largely aligned by product., how do we focus on a larger average deal size for every transaction, and so big investments on that front, really a strong focus on productivity as it relates to moving people up market as well. We’re thinking about self-serve in the bottom end of our market. How do we drive a self-serve motion, automated motion at the low end of our market to bring our account executives upmarket to drive higher productivity in the sales organization? So clearly, a big motion for us right now. Feel very good about our big deal motion. Actually in Q4, we saw some – sorry, in Q1, we saw some very good big deal execution from the team. That is not really an area that has held us back. We feel very good about our ability to transform companies and transact these large businesses. It really is the velocity business that has held us back a bit on our create and close some of the SMB transactions. So, we have a clear focus in this area to drive the productivity with our plans going into Q2 and beyond into Q4. Mike Spencer: Thanks, Brad. Emma, next question please. Operator: Your next question comes from the line of Brent Thill with Jefferies. Your line is open. Brent Thill: Amy, regarding Americas, that was a pretty large decel, one of your slowest growth quarters, I think, ever in Americas. The rest of the world did decel, but maybe not quite as the magnitude of the Americas. Can you just speak to what happened there in that region? Amy Weaver: Sure. So thanks, Brad, for the question. The Americans did see a deceleration, a 10% year-on-year revenue growth, compared to 17% in EMEA and about 24% in nominal APAC. We are continuing to see most of the pressure in North America. There were some real pockets of acceleration in EMEA and in LatAm, particularly in Switzerland, I think Brazil, Italy. So, we are seeing some good things, but North America has taken the brunt of the deceleration. Brian, do you want to come in and see if you can address that in more detail? Brian Millham: Sure. Yes. I think when we think about our business from an industry perspective, we have a very nice footprint of our great technology companies and financial services company, both of which were a bit slower than we would have liked in the Americas in Q1. And so, as we think about the all-in size of our Americas business, those industries felt a little bit more of the economic headwinds in the quarter in Q1. And so, I think a bit of a slowdown from that perspective is a result you’re seeing in the Americas business. Mike Spencer: Thanks, Brent. Emma, next question please. Operator: Your next question comes from the line of Mark Murphy with JPMorgan. Your line is open. Mark Murphy: Thank you very much. And I’ll add my congrats. So Marc, it feels like the tech and software industry has had a recession without the broader economy being in a recession quite yet, and that’s very unusual. Do you think with all the purging and optimizing of IT budgets, which is already taking place, plus Salesforce’s headcount optimization already being underway that perhaps the next recession might actually be more manageable or easier to navigate than what you had seen in some of the prior cycles? Marc Benioff: Well, I think that this is a great question. And I tried to address it on the last call. I just really think you have to look at 2020, 2021 was just this massive super cycle called the pandemic. I don’t know if you remember, but we had a pandemic a couple of years ago. And during that, we saw tech buying like we never saw. It was incredible and everybody surged on tech buying. So, you’re really looking at comparisons against that huge mega cycle. And that is what I think is extremely important to understand, the relative comparisons. And that is where my head is at, which is I am constantly comparing against what happened in 2021, but also looking at 2020 and 2019. That’s a little bit different than 2008 and that’s a little bit different than 2001. We didn’t exactly have these huge mega cycles that kind of we were exiting. And I – that’s also what gives me tremendous confidence going forward and what we’re really seeing is that customers are absorbing the huge amounts of technology that they bought. And that is about to come, I believe, to a close. I can’t give you the exact date, and it’s going to be accelerated by this AI super cycle. Mark Murphy: Thank you. Mike Spencer: Thanks, Mark. Emma, next question please. Operator: Your next question comes from the line of Brent Bracelin with Piper Sandler. Your line is open. Brent Bracelin: Good afternoon. I wanted to circle back to the generative AI discussion, if we could. I totally understand how large enterprises are turning to Microsoft, given the productivity tools and suite that they have, but as you start to engage with customers, what’s resonating relative to the Salesforce Gen AI journey? Is it the data layer and Customer 360 messages resonating? Is it the app layer around sales automation functionality that you’re going to offer? Just double quick on what customers are coming to Salesforce and engaging the you around some of the new things that we’ll hear about it sounds like in June. Marc Benioff: Well, I think that when you look at our artificial intelligence strategy, which we’re talking to the largest, most important companies and governments in the world, it has to be architected around security. It has to be architected around compliance, around trust. It has to be architected around governance. And this is very important. And of course, we’re also architecting it around being open. That is, we’re working with many AI companies to provide the best solutions for our company. Of course, we have a tremendous relationship with OpenAI. We also just invested in Anthropic [indiscernible] many of these companies. But I think ultimately, this is going to be a solution that enterprise customers are going to come in and make sure that their data is protected. And it’s also protected down at the user level. And Srini, do you want to come in and talk about exactly what we’re doing to make sure that we’re delivering the best possible solutions for our customers for AI? Srini Tallapragada: Yes, Marc. So, I think I met about 70 customers in the last quarter. And like Marc was saying, the only conversation everybody is interested is on – and while everybody understands the used cases, they’re really worried about trust. And what they are looking for us is guidance on how to solve that. For example, so we are doing a lot of things as the basic security level, like we are really doing tenant level isolation coupled with zero retention architecture, the LLM level. So the LLM doesn’t remember any of the data. Along with that, they – for them to use these used cases, they want to have – they have a lot of these compliances like GDPR, ISO, SOC, [Quadrant] [ph], they want to ensure that those compliances are still valid, and we’re going to solve it for that. In addition, the big worry everybody has is, people have heard about hallucinations, toxicity, bias, this is what we call [model trust] [ph]. We have a lot of innovation around how to ground the data on 360 data, which is a huge advantage we have. And we are able to do a lot of things at that level. And then the thing which I think Marc hinted at, which is LLMs are not like a database. These intra-enterprise trust, even once you have an LLM, you can’t open the data to everybody in the company. So, you need ability to do this – who can access this data, how is it doing both before the query and after the query, we have to build that. And then we have to be not only open, but also optimized. We are running an open – the way we’ll run is, we’ll run like a model [indiscernible] because one of the things everybody has to watch out is it’s great, but what about the cost to serve, not all models are equal. So, we are going to run this and pick very – we are going to pick a very cost-optimized curve, so the value is very high. And our Salesforce AI research has a lot of sales for state-of-the-art models and industry cases, which we are optimizing to run at very low cost and high value. Add to that, we’ve got the Trailblazers platform, which allows low code, high code, and many other things, and we’re going to optimize sort of jobs to be done for each industry and jobs. That’s really what they’re looking for because they have been using our AI platform. Like Marc mentioned, we already do 1 trillion transactions per day. And by the way, the data cloud, just in a month, we are importing more than 7 trillion records into the data layer, so which is a very powerful asset we have. So, coupled with all of this is what they are looking for guidance and how we think we can deliver significant value to our customers. Marc Benioff: Srini, I want to ask you a question. In January, you published a paper in nature from your research team, which was called large language models, generating functional protein sequences across diverse families, and you really showed something amazing, which was that deep learning language models have shown this incredible promise that you just articulated in various biotechnological applications, including protein design, engineering, and you also described very well one of our models that we’ve created internally, ProGen, which was a language model that can generate protein sequences with predictable function across large protein families. I was very impressed with that. And the entire research team deserves a huge amount of congratulations. So, when you look at that, especially dramatically and semantically correct natural language sentences for diverse topics or how you’re going to use that inside our platform against other models that you’re seeing like Llama, OpenAI’s model, Anthropic and others, when will Salesforce use our own models like [CoGen] [ph], ProGen, T-code, our lit model, when will we use an outside commercial model like an OpenAI or an Anthropic? And when will we go to an open source model like we’ve seen emerge so many of those, including like Llama. Srini Tallapragada: Yes. I think you hinted something very important. I think, as you know, Marc, we have – our I research team is one of the best-in-class model – state-of-the-art models from different areas. The way we are thinking of it is like anything else, where the world is going to go, which we strongly believe is going to be multiple models. And depending on the used case, you will pick the right models, which will provide you the value at the lowest cost. Where we have to run with highly regulated industries, where the data cannot leave the trust boundary or where we have significant advantage, where we can train on industry-specific data or Salesforce-specific – 360-specific data, like, for example, our FX model are helping our customers implement or our flow, we will use our internal model. Where we need more generated image models or something where it needs public image databases, we may use a coherent or an OpenAI. It depends on the use case and which is why, at a given request, a secure trusted gateway will decide smartly which is the best used case, which is the model, and we always keep running the [indiscernible], which is what I mean. So today, one particular model may be good. Tomorrow, something else will come, and we’ll behind the team flip it, but our customers don’t need to know that. We will handle all of it. We’ll handle the model trust. We’ll handle all the compliances and all behind the scenes. And this is always what we promise to our customers, we’ll always future-proof. That’s the Salesforce promise to our customers so that they can focus on the business used cases. Marc Benioff: So just one last follow-up question. You’ve described very well the GPT trust layer, which I think is going to be a significant amount of value added that we’re going to provide to our customers that’s going to be quite amazing. And then you develop these specific grounding techniques, which are going to allow us to keep our customers’ data safe and not be consumed by these voracious large language models, which are so hungry for all of our customers’ data. What is going to be the key to actually delivering this now across regulated industries? Srini Tallapragada: I think the key is innovations we are doing, which people will see starting next month is around what we call [from generation] [ph] and grounding. These are techniques, which we’ll have to do, but it will work only because we have – all of this as based on underlying data. We have the Data Cloud, where we have all the 360 data, which is there. So, we’re able to ground these models and do it. So, there are a lot of other techniques, which are very technical, which we put it on our block. But that’s the innovation that we’re doing. And you have to remember that Salesforce also is a metadata model. So, we have a semantic understanding of what our customers are trying to do. We’re going to leverage the Metadata platform and do this grounding automatically for our customers, of course, while keeping the trust. That’s the base line. Marc Benioff: Absolutely. Thank you so much, Srini. Mike Spencer: Emma, next question please. Operator: Your next question comes from the line of Raimo Lenschow with Barclays. Your line is open. Raimo Lenschow: Hi, thank you. Question for Amy or Brian maybe more. The improvement in profitability or the raised guidance for profitability and cash is that all timing? Can you talk a little bit about that? Is it just timing or are there other factors we should consider in here? Thank you. Amy Weaver: So Raimo, well I’ll start and then I can turn it over to Brian for a little bit more color. So, in terms of the great Q1 that we just saw, really pleased to see us coming in at 27.6% and also really pleased about the 28% – [the raise] to 28% for the full-year. What really drove the 27.6 was two things. It were the actions that we took that we announced in January with the restructuring. Executing on that, as well as having a very disciplined reinvestment strategy, and that led to that. And that’s also where we’re going to see this going through the rest of the year, driving the expansion 28% and then also putting us on track for the 30% margin in Q1 of next year. As I look through overall at transformation, I would really divide it into two stages benefits that we’re getting from that initial transformation. And again, that’s what you’re seeing in Q1 and this year. And then the second stage, which is really as we’ve been going through this comprehensive operating and go-to-market review, that review is going to enable the second phase of our transformation, and that’s something that’s going to be ongoing and long-term over the next few years. You’ll see benefits to our margin in outer years beyond FY 2024. Brian, anything you would add? Brian Millham: Yes, thanks for the question. When we think about longer-term structures, we obviously took the action in Q1. But longer term, we’re looking at things like how do we leverage comp plan redesign to drive better efficiencies in our organization going forward. How do we continue to look at self-serve at the low end of the market to drive better efficiencies in our organization. So, resellers as a potential investment that we’ll make in emerging markets is long-term leverage on the efficiency gains. So lots of things that we’re doing that will be in sort of the Phase 2 oriented around process improvement and systems improvement. And again, as I mentioned, top plan design that will drive better efficiencies in the organization. Mike Spencer: Thanks, Raimo. Emma, let’s go to next question please. Operator: Your next question will come – is from Karl Keirstead with UBS. Your line is open. Karl Keirstead: Okay. Great. I’ll direct this to Amy as well. Amy, congrats on that margin improvement. I’ve got a two-parter both related to margins. First, what is the timing of the receipt of that Bain operational review that might ostensibly kick off the second phase of cost cutting? And then secondly, you and Brian talked about this reinvestment in R&D and investing heavily around AI. I’m wondering if those planned investments are greater than you anticipated when you initially set the guidance three months ago, such that you need to run a little bit harder on OpEx management to offset it and keep delivering on your stated margin targets? Thanks so much. Amy Weaver: Great. Thanks, Karl. So first on the timing. As I mentioned, we’ve been doing this end-to-end comprehensive operating and go-to-market review. The entire company has been involved in that. There’s really no stone unturned. We’re getting close to the end of that process, and then we will be moving into the implementation. You’ll be hearing more about that in future quarters. Turning to reinvestment. We are keeping a very close eye on reinvestment, very excited particularly about artificial intelligence. So, much of what Srini has been talking to you about, I don’t view this as a greater investment from what we were looking at earlier. We’re really going along with our current plans. We are looking at operating expenses management, and we’re looking at it seriously every day, but that’s not something that has changed. Mike Spencer: Thanks, Karl. Operator, we’ll move to our last question now, please. Operator: Our last question comes from the line of Kash Rangan with Goldman Sachs. Your line is open. Kash Rangan: Hi, thank you very much team. Congratulations on putting up terrific operational results, and a good cash flow, good margins, et cetera. Marc, you talked about a super cycle of buying and technology in the years ahead. Can you just parse for us, if you don’t mind, what is new about generative AI as far as Salesforce as opportunities are concerned, netting out against what Einstein has been able to accomplish for you – for the company? And how does it show up in the product in terms of productivity? What are the scenarios by which customers can experience this amazing productivity? And how can you charge more for delivering that, kind of value? Thank you so much. Marc Benioff: Well, thanks, Kash, for giving me the opportunity to talk about our AI vision, and I’m also going to ask Srini again to fill in some of the details. But I think it started to occur to me – I think folks know, I have – my neighbor is Sam Altman is the CEO of OpenAI, and I went over to his house for dinner, and it was a great conversation as it always is with him. And he had – he said, Oh, just hold on one second, Marc, I want to get my laptop. And he brought his laptop out and give me some demonstrations of advanced technologies that are not appropriate for the call. But I did notice that there was only one application that he was using on his laptop and that was Slack. And the powerful part about that was I realized that everything from day 1 at OpenAI have been in Slack. And as we kind of brainstormed and talked about – of course, he was paying a Slack user fee and on and on, and he’s a great Slack customer. We’ve done a video about them, it’s on YouTube. But I realize that taking an LLM and embedding it inside Slack, well, maybe Slack will wake up. I mean there is so much data in Slack, I wonder if it could tell him what are the opportunities in OpenAI? What are the conflicts, what are the conversations? What should be his prioritization? What is the big product that got repressed that he never knew about? And I realized in my own version of Slack at Salesforce, I have over 95 million Slack messages, and these are all open messages. I’m not talking about closed messaging or direct messaging or secure messaging between employees. I’m talking about the open framework that’s going on inside Salesforce and with so many of our customers. And then I realized, wow, I think Slack could wake up, and it could become a tremendous asset with an LLM consuming all that data and driving it. And then, of course, the idea is that is a new version of Slack. Not only do you have the free version of Slack, not only do you have the per user version of Slack, but then you have the additional LLM version of Slack. And for each one of our products in every single one of our categories, there’s that opportunity to upsell and cross-sell into the next version of generative AI, not just with Slack, but you can also imagine, for example, even with Salesforce, the ability as we’re going to see in June, that many of our trailblazers are amazing low-code, no-code trailblazers, but soon they’ll have the ability to tap in to our LLMs like ProGen and Cogen that have the ability to code for them automatically. They aren’t coders. They didn’t graduate computer science degrees. And if they need to write a sophisticated Apex code or other code, it can be a challenge for them, but because you know what is there only 8 million or 10 million coders in the whole world – but now with LLMs, everybody can start to code. That’s an amazing productivity and augmentation of everybody’s skill set. And that’s a great way to look at what could happen, for example, with our core products, but even with Tableau, which has tremendous programmatic engine as well or even MuleSoft, which is a highly programmatic product that then coupled with an LLM can have the ability to go forward. But of course, those LLMs are highly trained models for those specific types of code, and then that is something that we would add on either through partnership or through our own LLM, as Srini described, it’s another layer of value that we can provide to our customers. In all cases, customers are going to be more productive. They’re going to be more automated, and they’re going to be more intelligent. And as we look at some of the examples that we’ve given like at the New York World Tour, you saw our Marketing Cloud do something very cool that it couldn’t do even just 6 months ago. It segmented the database on its own. It wrote an e-mail on its own. Of course, it required editing, and it also built a landing page on its own. That was amazing. Or as we saw at the Tableau conference, we saw Tableau being able to create its own visits or visualizations that was incredible. And what we saw at our Trailhead DX, we saw Einstein GPT which started to do these amazing next-generation things. And I think in each of these areas, we can offer more value, but we must do it in the auspices of trust, data integrity and governance. And that is what we have been working on now for a considerable amount of time. Of course, we’ve led – we have always wanted to be the Number 1 AI CRM. And we are, if you look at Einstein’s transaction level, I think that that’s enough evidence right there. But I think this idea of generative AI, this starts to reconceptualize every product and we will start to build and develop not only extensions to all of our current products, but entirely new products as well. And we have a lot of exciting ideas of things that we can do to help our customers connect with their customers in a new way using generative AI. Srini, do you want to come in and talk about that? Srini Tallapragada: Thanks, Marc. So, I think the way I see it is this AI technologies are a continuum that is predictive then they generate, and the real long-term goal is autonomous. The initial version of the generative AI will be more in terms of assistance. And like Marc was saying, we are seeing like the most common used case everybody understands implicitly is self-service bots or in the call center or agent-assistant assistance, which I think really helps productivity. But the other used cases, which we are going to see, and in fact, I have rolled out our own code LLMs in our engineering organ, we are already seeing minimum 20% productivity. And in those cases… Marc Benioff: Well, that’s a very key point. Isn’t it? That you’re seeing a 30% productivity increase in your own engineers using our own LLM. Srini Tallapragada: 20%, we are seeing minimum. In some cases, up to 30%. Now, a lot of our customers are asking the same. We are going to roll Einstein GPT for our developers in the ecosystem, which will not only help not only the local developers to bridge the gap, where there’s a talent gap, but also reduce the cost of implementations for a lot of people. So there’s a lot of value. This assistant model is where we’ll see a lot of uptick. And then I think the fully autonomous cases, for example, in our own internal used cases with our models, we are able to detect 60% of instance and auto remediate. That requires a little bit more fine-tuning and we’ll have to work with specific customers to get to that level of model performance. So, I see this is just the start of this [cut] [ph]. The resistant model is the initial thing to build trust and a human in the loop and validate it. And then as the models get better and better, we’ll keep taking used cases where we can fully automate it. Marc Benioff: And address this one issue that a lot of customers come in like they did yesterday, and they tell us they think they’re just going to take all of their data, all their customer data, all of their information and put it into an LLM and create a corporate knowledge base, and it’s going to be one amalgamated database. Why is that a false prophecy? Srini Tallapragada: Because even today, any example you see, even though we have hundreds of Slack channels, there are a lot of specific Slack channels, which only you want access to. You don’t want that. LLM doesn’t know. There is no concept of – it combines all this information. So, unless you put the layer both before who can access the data and then when it generates response, what he can do, you don’t want one wealth manager to generally generate a report, an account report where you’re mixing customers’ balances. So there are a lot of trust issues we have to solve. So, LLMs are good for a lot of very creative generative used cases, initially, where it’s public data that everybody can use it. Those are used cases. I think there is enough of low-hanging fruit in the initial phases with assistant model, which we’ll solve. The really complex automated cases, the role level, record level sharing, we have a lot of techniques, which we are developing, which we will do. It’s also a research area, too. That one, I think we should be tempered with expectations, but there’s enough of, like I said, the develop, for example, I gave product example there’s enough of productivity which we will get. Marc Benioff: Well, we’re really excited to show all of this technology at our AI Day on June 12 in New York City. And then also when we get to [Dreamforce GPT] [ph], we’re going to have an incredible demonstration of this technology. Mike Spencer: So with that, we want to thank everyone for joining us today, and we look forward to seeing everyone over the coming weeks. Have a great one. Operator: This concludes today’s conference call. You may now disconnect. Follow Salesforce Inc. (NYSE:CRM) Follow Salesforce Inc. (NYSE:CRM) We may use your email to send marketing emails about our services. Click here to read our privacy policy......»»

Category: topSource: insidermonkeyJun 6th, 2023

ChargePoint Holdings, Inc. (NYSE:CHPT) Q1 2024 Earnings Call Transcript

ChargePoint Holdings, Inc. (NYSE:CHPT) Q1 2024 Earnings Call Transcript June 1, 2023 ChargePoint Holdings, Inc. beats earnings expectations. Reported EPS is $-0.15, expectations were $-0.17. Operator: Ladies and gentlemen, good afternoon, my name is Lisa, and I’ll be your conference operator for today’s call. At this time, I would like to welcome everyone to the […] ChargePoint Holdings, Inc. (NYSE:CHPT) Q1 2024 Earnings Call Transcript June 1, 2023 ChargePoint Holdings, Inc. beats earnings expectations. Reported EPS is $-0.15, expectations were $-0.17. Operator: Ladies and gentlemen, good afternoon, my name is Lisa, and I’ll be your conference operator for today’s call. At this time, I would like to welcome everyone to the ChargePoint First Quarter Fiscal 2024 Earnings Conference Call and Webcast. All participant lines have been placed on a listen-only mode to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. I would now like to turn the call over to Patrick Hamer, ChargePoint’s Vice President of Capital Markets and Investor Relations. Patrick, please go ahead. Patrick Hamer: Good afternoon and thank you for joining us on today’s conference call to discuss ChargePoint’s first quarter fiscal 2024 earnings results. This call is being webcast and can be accessed on the Investors section of our website at investors.chargePoint.com. With me on today’s call are Pasquale Romano, our Chief Executive Officer and Rex Jackson, our Chief Financial Officer. This afternoon we issued our press release announcing results for the quarter ended April 30th, 2023, which can also be found on our website. We’d like to remind you that during the conference call, management will be making forward-looking statements, including our outlook for the second quarter of fiscal 2024. These forward-looking statements involve risks and uncertainties many of which are beyond our control and could cause actual results to differ materially from our expectations. These forward-looking statements apply as of today and we undertake no obligation to update these statements after the call. For a more detailed description of certain factors that could cause actual results to differ, please refer to our Form 10-K filed with the SEC on April 3rd, 2023 and our earnings release posted today on our website and filed with the SEC on Form 8-K. Also, please note that we use certain non-GAAP financial measures on this call which reconcile to GAAP in our earnings release and for certain historical periods in the investor presentation posted on the Investors section of our website. And finally, we’ll be posting the transcript of this call to our Investor Relations website under the Quarterly Results section. And with that, I’ll turn it over to Pasquale. Pasquale Romano: Thank you, Patrick, and thank you all for joining us today. We delivered a strong first quarter. Revenue was at the high end of our guidance range at $130 million and non-GAAP gross margin sequentially improved two points to 25%. To put these results into perspective, we achieved a 59% year-over-year growth rate in the first quarter and the second largest quarter in ChargePoint’s history. We did that while the EV installed base in North America and Europe are still in single-digits, and the EV market is only at the beginning of a decade’s long growth cycle. We also achieved this growth in the midst of a challenging macroeconomic environment. Diversification across verticals and geographies continues to contribute resilience to our business. So while we saw less growth in North American Commercial and Residential than we would have liked due to what we believe is a delay in discretionary purchases we continued to see overall growth and margin improvement. Rex will address guidance for the second quarter. But just to give you a sense of the magnitude of the long-term opportunity ahead of us, the midpoint of that guidance would make Q2 the largest quarter in ChargePoint’s history. You’ll also hear Rex talk about non-GAAP adjusted EBITDA. To give some context, we use non-GAAP adjusted EBITDA as a key measure of the health of our business as we drive towards profitability and as we disclosed in our proxy statement filed last week. This metric is one of the two components of our annual management bonus programs. Beneath the top-line results, we’re continually improving our operations and investing for future scale. We have consistently improved gross margins while recovering from supply chain issues making meaningful changes to the cost of our products and optimizing our operations. Also as we scale, we are carefully managing our operating expenses while making the necessary investments in our support operations and internal business systems. We are committed to delivering dependable infrastructure to our customers. So drivers can find it, use it and depend on it everywhere. Turning back to Q1, we saw two areas of particularly strong growth, Europe and fleet. For the first time in our history, Europe delivered over 20% of ChargePoint’s quarterly revenue. Meanwhile, Q1’s fleet billings more than doubled year-over-year despite supply limitations on vehicles entering the segment relative to demand, and as a percentage of billings, fleet increased from Q4. We’re encouraged to see continued resilience in these growth areas. Beyond the financials, we continued to focus on our products. We offer industry-leading hardware and software for nearly every fueling vertical. Our solutions help our customers deliver the kind of EV driver experience that will continue to accelerate EV adoption across North America and Europe. In brief, better charging infrastructure delivers a better driver experience, which drives more value across the entire EV ecosystem. The positive feedback loop for growth that benefits ChargePoint, our partners and EV drivers in the environment. We are betting on the continued changeover from fossil fuels to electric drive regardless of OEM or vertical. And as a result, we believe we are an index for the electrification of mobility. Before handing off to Rex, let me update you on a few key statistics to give you a little more color on our continued growth. On the network side, we give drivers and ecosystem partners access to approximately 745,000 EV ports in North America and Europe. 243,000 of these are active ports under management on the ChargePoint network up from 225,000 ports last quarter and we recently passed a milestone of over 500,000 roaming ports. These roaming ports are critical to delivering a world-class ecosystem to ChargePoint’s drivers site host customers and strategic partners such as OEMs and fuel card providers. Approximately 21,000 of the 243,000 ports on the ChargePoint network are DC fast-charging up from approximately 19,000 at the end of Q4 and approximately one-third of our overall ports are located in Europe. We count 76% of the 2022 Fortune 50 and 56% of the 2022 Fortune 500 as our customers. This reflects excellent penetration given our land and expand strategy, the stickiness of our solutions, and our strong rebuy rates. From an environmental perspective as of the end of the quarter, we estimate that our network now has fueled approximately 6.3 billion electric miles avoiding approximately 252 million cumulative gallons of gasoline and over 1.25 million metric tons of greenhouse gas emissions. So when you put all that together, it shows that despite the current economic environment, ChargePoint growth continues. We made significant progress against our long-term road map ensuring that ChargePoint scales ahead of this remarkable market opportunity. We’re running a highly differentiated business that is not CapEx intensive. And as you’ll hear from Rex, we’re heading into the black while we turn the world green in the early innings of the EV transition Rex, over to you for financials. Rex Jackson: Thanks, Pasquale. As a reminder, please see our earnings release where we reconcile our non-GAAP results to GAAP and recall that we continue to report revenue along three lines. Network charging systems, subscriptions, and other, network to charging systems is our connected hardware. Subscriptions include our cloud services connecting that hardware, assure warranties, and our ChargePoint-as-a-service offering where we bundle hardware, software and warranty coverage into recurring subscriptions, other consists of professional services and certain non-material revenue items. As Pasquale indicated, we had a solid Q1 with revenue of $130 million, up 59% year-on-year and above the midpoint of our previously announced guidance range of $122 million to $132 million, down seasonally as expected from Q4, Q1 was notably the company’s second largest quarter ever and a good start for the year when compared to Q1 contributions over the past two years. Network charging systems at $98 million was 76% of Q1 revenue, down from $122 million and 80% in Q4, due to typical seasonality. Q1 revenue from network charging systems grew 65% year-on-year. Subscription revenue at $26 million was 20% of total revenue, up 49% year-on-year, up sequentially, and again above the $100 million annual run rate we referenced in our last call. Our deferred revenue which is future recurring subscription revenue from existing customer commitments and payments continues to grow, finishing the quarter at $205 million up from $199 million at the end of Q4. We’re especially encouraged to see this continued growth in our recurring revenues in the very early days of what we believe is a decade’s long EV adoption curve. Other revenue at $5 million and 4% of total revenue increased 20% year-on-year. Turning to verticals, first quarter billings percentages were commercial 63%, fleet 24%, residential 11%, and other 2% reflecting a particularly strong performance in fleet. Commercial grew 44% year-on-year, while fleet was up 129%. Residential grew at 13% year-on-year, and maintained its generally consistent billings percentage. From a geographic perspective, Q1 revenue from North America was 79% and Europe was 21%. As Pasquale mentioned, Europe continues to outpace North America on a percentage basis of 70% year-on-year. Turning to gross margin, non-GAAP, for Q1 was 25% up sequentially from Q4 is 23% and up eight points from 17% in Q1 of last year. This improvement is primarily a combination of diminishing supply chain and logistics expense pressures, significant operational improvements and better scale. We continue our considerable investment in our driver and host support infrastructure because we believe support and reliability, our critical differentiators for both drivers and our customers. We expect continued improvement in non-GAAP gross margin this year. Non-GAAP operating expenses for Q1 were $85 million a year-on-year increase of 2% and a sequential increase of 6% primarily reflecting payroll taxes as well as annual compensation increases effective April 1st. As we look out to the rest of 2023, we will manage expenses carefully and expect to deliver improvements in operating leverage. As you may recall in calendar 2020 and 2021, our OpEx which reflects significant forward investments in our business, was at approximately 100% of our revenue. In 2022, we took that down to 53% in Q4 and 69% for the year. In Q1, we were at 66% given revenue seasonality, but again expect continued improvements this year, particularly in the second half. Given this trajectory, I’d also like to expand on Pasquale’s comments regarding non-GAAP adjusted EBITDA. We added this metric and the associated reconciliation today in our press release with the goal of better illustrating our path to profitability. To calculate adjusted EBITDA, we take our non-GAAP net income loss and add back interest, taxes and depreciation. The depreciation component is low. Thanks to our business model. Using this metric, Q1 non-GAAP adjusted EBITDA was a loss of $49 million a year-on-year improvement of 27%. We look to cut this loss further by approximately two-thirds by Q4 of this year. Looking at cash, we finished the quarter with $314 million, down from $400 million last quarter. As in prior quarters, the primary driver of our negative cash flow is operating loss. In Q1, we also managed to break free on a number of supply chain issues and move our inventory solidly from raw materials and WIP or work in progress, to finished goods meaningfully increasing our inventory level, which helped us avoid leaving business on the table as we have been forced to do in recent quarters. This build helped us in Q1 and sets us up well for Q2 and for Q3. Inventory will vary as we look forward, but we expect it will grow with the business. We used our ATM very likely in Q1, adding $18 million in cash through the program. We will evaluate use of the ATM on a quarter-by-quarter basis and also continued to assess non-dilutive liquidity options. To close on a couple of other key figures, stock-based compensation in Q1 was $24 million consistent with the past three quarters. Our annual compensation cycle includes equity. So we expect our annual step-up and stock-based compensation in Q2 to be approximately $8 million and to be fairly constant for the ensuing three quarters. We had approximately 353 million shares outstanding as of April 30, 2023. Turning to guidance for the second quarter of fiscal 2024, we expect revenue to be $148 million to $158 million, up 41% year-on-year at the midpoint. We are committed to being adjusted EBITDA positive in Q4 of calendar 2024 and remain committed to being cash flow positive by Venezuela. In summary, we’ve achieved the growth we expected to achieve despite significant headwinds. We continue our march to profitability even while we invest in operational excellence at scale. Our differentiated business model is not CapEx intensive and our adjusted EBITDA metric, which we consider to be a strong indicator of the overall health of our business gives us confidence in our trajectory. With that I’ll turn the call back to the operator for questions. Q&A Session Follow Chargepoint Holdings Inc. (NASDAQ:CHPT) Follow Chargepoint Holdings Inc. (NASDAQ:CHPT) We may use your email to send marketing emails about our services. Click here to read our privacy policy. Operator: Thank you. [Operator Instructions] We’ll take our first question from Gabe Daoud with Cowen. Gabe Daoud: Hey, thanks guys, I appreciate all the prepared remarks, maybe Pasquale. I just wanted to hit on the comment earlier in your prepared remarks just about some of the commercial and residential, we missed that you guys noted, just curious if you could give a bit more color on how that may be snaps back as we progressed through the rest of this year and maybe what’s kind of embedded in your own internal forecast. Pasquale Romano: So, hi, Gabe. It’s a very simple answer. Actually, the beauty of this market is the utilization pressure sits there because EVs keep — we keep converting the installed base from fossil fuel to electric vehicle. Businesses right now, all businesses, commercial businesses that have a discretionary need for charging for their employees or their customers can adjust timing to deal with the macroeconomic uncertainty. So the need doesn’t go away, but the optionality to delay addressing that need in some of our commercial customers exists. What I’ll point you to though is something that we’ve commented on in previous earnings calls as we went through the pandemic. The mix in our business by vertical shifted pretty meaningfully during the pandemic because we went into an abrupt work from home situation and other areas of the business because we’ve been broadly placed across verticals and geos, other places in the business picked up the slack. So we didn’t have to deal with the massive discontinuity financially. You’re seeing that I think play out here again. So we still I think turned in very aggressive growth on a quarter-to-quarter basis, Q1 this year to Q1 last year. It’s a healthy percentage step-up in the geo-diversity especially given that Europe is now 20% of the business and performing strong and fleet up 200% year-over-year similar Q1 to Q1. It’s just evidence that as the macroeconomic water balloon exerts its pressure on the different verticals that we’re diverse enough to take up the slack. So we’re not in a position where we think the demand has gone away and that it’s perished, we’ll get it back as the macroeconomic situation clears up, hope that answered it. Gabe Daoud: Yeah, that’s great color. Thanks, Pasquale. Maybe as a follow-up just and — maybe I’ll ask just about the mix shift or just the billings and the price momentum that you reported in fleet in particular. Could you maybe just give us a bit more color on where exactly are you seeing that strong growth and strong demand within fleet? Is it last mile logistics? Is it I guess on the light-duty vehicle side just given how we’re still vehicle constrained on medium and heavy duty? But just curious I guess is what can you say on fleet, what’s really driving the momentum there and then is it also more fleet momentum in Europe versus the US? Or is it fairly similar? Thanks guys. Pasquale Romano: It’s easier to go backwards with your follow-up question. It’s pretty balanced between Europe and North America fleets. As I said in my prepared remarks, it’s vehicle limited right now, if OEMs were producing vehicles in quantities to match demand, you’d see faster penetration and conversion from fossil fuel to electric. It’s actually well aligned with a softer macro in that everyone’s looking for cost savings obviously and these are meaningful — these vehicles are meaningful components of the cost structures of the businesses that they serve and what that’s done is it’s slanted as I’ve mentioned by the way consistently in previous calls, it’s slanted to land, but not much expand within a customer. And so that’s, I think, just a good indicator for things to come in the future. When that starts to uncoil, it’s complicated, given that there is a bit of a dependency there on vehicle OEMs producing things at scale. One of the bright spots that I mentioned before regarding fleet is transit because that’s the most mature segment. And so we continue to see that segment do quite well, but there has been no general shift in mix between the quarters, that’s worth — that’s materially worth reporting. Gabe Daoud: Okay. Okay, great. That’s helpful. Thanks, guys. I’ll take the rest offline. Operator: We’ll take our next question from Colin Rusch with Oppenheimer. Colin Rusch: Thanks so much guys. Can you talk a little bit about the dynamics in the US commercial market? Can you give us a bit more detail on what’s happening with commercial property owners as they work through cost of capital changes, rental rates and looking at upgrading amenities? With the sales cycle, it looks like conversations you’re having with folks around when and kind of volume of deployments? Pasquale Romano: Colin, the conversation is not any different now than it’s been in the past. The commercial conversations tend to be a mixed bag of are you dealing with the tenant? Are you dealing with the property manager? Are you dealing with the landlord? Are you dealing with all of the above in combination? So it really is situational. And that hasn’t changed. You are seeing property developers and property managers take a more keen interest right now in charging as an amenity more broadly in their portfolio versus in hotspots driven more by tenant — kind of tenant activities. But I think, in general, because the dominant situation there is return to office and as you’ve seen in many statistics that have been reported, we are not — we’re moving to — we’re moving back to a larger component of in-office. But we certainly haven’t snapped back all the way. So that’s probably the biggest component in commercial shift is if people aren’t driving to the office, so workplace charging component will continue to basically move down proportionately to effectively the utilization in the parking lot at office buildings. It doesn’t mean that there isn’t charging going in. It just goes in proportional to the number of days folks are in the office. We will also remind you is it’s not — if you go in three days or if you go in five, it generates the same amount of utilization pressure in the parking lot on these three days if they are synchronized. So there’s a lot of puts and takes there. And I think as this continues — and it gets confused by a lot of other things that are going on in the macro as well, it gets — the complexity goes up. So we’ve got good visibility into it and we’re managing it closely. Colin Rusch: Excellent. That’s super helpful. I’ve got two other things. Just looking for an update there and then maybe a little bit disparate, some of the permitting streamlining efforts that are going on at state level and even at a national level, if you could just give us a sense of anything that you’re tracking very closely there that could be meaningful for the business and then also the potential to consolidate some of these not — these non-fully networked chargers, whether it’s in the US or Europe and how that opportunity is changing for you guys near-term? Pasquale Romano: It is easier to take that one backwards. If you look at consolidation of non-network chargers, there’s a lot of programs, a lot of, I mean, not that our revenue is primarily subsidy dependent, but almost all I can think of anyway subsidy programs have a requirement for the charger to be managed connected to some port of network and meet some set of requirements either at the most basic level for reporting, but usually includes some energy management to give some benefits to the grid. So what you should think about there is a lot of the unmanaged chargers that are out there, will likely get replaced with managed chargers because if they don’t have the necessary communication and processing gear, it’s easier to just tear them out, most of the work by the way is in laying the electrical infrastructure leading up to the chargers. So that’s a very cost-effective swap out. That’s not something that we see as significant yet as a replacement cycle, only because the market is scaling so quickly, the growth sort of swamps it, but I would expect that those things would change out over time. With respect to permitting, I just want to point you to a couple of things in the prepared remarks. If you look at the total ports on our network in terms of activated and under management and that means they’ve not only gone through full installation, but they’ve also gone through software activation. That means the customers decided how they want to use it all that sort of stuff. And we went from 225,000 ports in Q4, to 243,000 ports and you can read the remarks, but that was spread pretty uniformly between DC and AC. What’s interesting in that is the pipeline is already built into our numbers because that is not representative of the ports we sold last quarter. That’s representative of the ports that we sold at some previous months or set of months that have gone through the construction and installation process and the activation process which is not an instantaneous thing in time. So this — you’re seeing in the port growth rate the shadow of the permitting delays print through. Now, for the big stuff, right, the big corridor fast-charging programs, a lot of the big fleet transit programs. Yeah, we see permitting delays continue to be a challenge for our customers. But again that has been a challenge for our customers, for a while, we absolutely would applaud to any change in permit streamlining or utility interconnect streamlining because it will certainly help accelerate, it will accelerate some of the customers’ ability to add the necessary infrastructure. So headline delays are built into our numbers, built into our guide, they’re built into our numbers. They’re built into everything that you’re hearing from us. If we can make it go faster, it’s upside. Operator: [Operator Instructions] We’ll take our next question from James West with Evercore ISI. James West: Hey, good afternoon guys. Hey, Pat. Thanks, Rex. Wanted to ask about the announcement out of Tesla and Ford, a couple days ago, their alignment, the opening of the sort of the supercharger network and what your thoughts were around that? I mean is it a nothingburger? Or is it something to be expected? Is it showing us that there’s two superchargers out there? What’s the — what’s your take on that? Rex Jackson: So I could have bet if one of you would have asked that question. So the shortest way I think to crystallize it in your mind is that, Tesla has been an outsized player, right now they are still sitting around 70%-ish market share in the United States in terms of vehicles in the installed base and that’s Supercharger network has been around since the beginning of the time that we’re in revenue and if it weren’t for Tesla’s on the road, our customers would have no reason to buy a ChargePoint charger because the dominant car there, up to now, and they’re generating effectively the utilization pressure in the parking lots that are causing across vertical, across all our verticals, customers who want to buy our products and services. So the net-net is the Supercharger network whatever effect it’s having is built into our numbers, okay? Now with that said, our fast chargers, in particular, because on the AC chargers side, Tesla ships with an AC adapter since the beginning of time, it’s easy, it doesn’t impair anything. So that’s a — there’s literally no impact there. On the AC side, I mean on the DC side, our chargers have modular cables and modular holsters. So the ability for us to address if the need arises, the ability in particular use cases to add a direct Tesla cable versus using an adapter like people use today, is possible we’re now spending time obviously thinking about innovative ways to not have to increase what is very expensive element and extra cable on a charger to be able to get around some of those problems. So stay tuned, we’ll be pretty innovative there but I wouldn’t — I don’t read it as a bad thing for us long-term at all. James West: Got it. Okay, thanks. Operator: We’ll take our next question from Morgan Reid with Bank of America. Morgan Reid: Hi, everyone. Thanks for taking my question and nicely done on the growth drivers in fleet in Europe. Just curious if you can maybe elaborate on how we should think about that strength through the rest of the year. Just wanting to understand how those two segments, in particular, are expected to scale through the year here after some nice growth here in the first quarter. Pasquale Romano: I would expect fleet to continue to be strong, these are customers that are electrifying for hard business reasons. There is no discretion in electrification. It’s competitive in the long-term for fleets, for most fleets and then in the long-term, drops our cost structure and there’s a long learning curve and optimization cycle. So they need to start today to not have it be an impediment to their business in the long-term. So we expect that segment regardless of the macroeconomic environment to be very strong on a go-forward basis. Europe is ahead of the US currently in EV adoption. We expect it to continue to be strong. There is a more consistent policy mandate across all of Europe supporting the transition from electric drive to — from fossil fuels to electric drive, now correspondingly in the long-term, we don’t see any major difference between the US and Europe. Remember OEMs have to operate internationally and supply chains and cost structures will shift favorably to EVs over the not-too-distant future. So I think it’s an inevitable conclusion that in both markets, you’ll see a conversion rate but currently, Europe is for all the reasons I mentioned going to continue to be I think very strong for the company. So we would expect that we would see strong growth from that sub-vertical or sub-geo I should say. Morgan Reid: Great. Thank you. And then also, can you just talk about how we should think about the OpEx discipline through the year? And you all talked about kind of scaling operating leverage towards a positive inflection later this year. Just curious if you can kind of help quantify the moving pieces there as you look to continue scaling the topline again still a very disciplined OpEx line. Pasquale Romano: Yeah. So the short answer is we have a number in Q1 and we’d like to stay close to that number for each of the rest of — the next three quarters of this year, obviously there’ll be some variations last year, we were very consistent going out of the gates and staying close to it. So I think we’re going to try to operate within a pretty tight range. Morgan Reid: Great. I’ll take the rest offline. Thanks. Pasquale Romano: Thank you. Rex Jackson: Thanks, Morgan. Operator: We’ll take our next question from Matt Summerville with D.A. Davidson. Matt Summerville: Thanks. First, just a question on gross margins up 200 bps sequentially, how should we expect that to kind of play out as we move through the year? Should we expect a similar kind of step function improvement quarter-on-quarter something a bit more conservative to that? And what are the main levers to gross margin improvement as we sit here for the balance of your fiscal ’24? Pasquale Romano: Yeah. So I think, as we said, we expect continued improvements. I don’t think anyone here would say that ’25 is a place that we should be parking our electric vehicle for these to go up, whether it goes up a point or two or whatever, quarter-on-quarter, we might be seeing, is very mix-dependent, but I’m confident that we’re going to head towards the numbers we’ve discussed before, towards the end of the year, I don’t want to peg it to a number, but it’s going to be better in Q4 than it is today. So expect it to continue to decline this year. Matt Summerville: And then with respect to the comment you made Rex towards any of your compared remarks. Are you thinking cut the EBITDA loss by roughly two-thirds between now and the fourth quarter, so say going from $49 million to say $16 million or thereabouts? Is the entirety of that bridge just scale from the revenue growth you’re expecting? Or are there actual cost and expense cuts that are contemplated in there? Thank you. Pasquale Romano: It’s actually all of the above. Clearly, grow the revenue line, which we would hope to do, consistent with what we’ve done in prior years because you start in Q1 and you end up in Q4, Q4 is a lot better than Q1. So clearly that helps. We expect gross margin to improve during the year that definitely helps a lot. And then if we are disciplined on OpEx and keep that in flattish territory, you can make the math work pretty quickly. Operator: We’ll take our next question from Mark Delaney with Goldman Sachs. Mark Delaney: Yes, good afternoon, and thanks very much for taking my question. I was hoping to better understand some of the supply chain dynamics, I guess in terms of the P&L impact and stick to the gross margin theme first. You guys have been talking about how much of a headwind to gross margin, supply chain, I think at one point, it was something like 900 basis points of a headwind, where does that stand as of this most recent quarter in terms of the impact. And then more broadly supply chain, if you could speak around, how you see that progressing? And do you think supply chain hold you back in terms of hitting your shipment target for the balance of the year? Thanks. Pasquale Romano: Yeah, thanks for the question, Mark. So to start, the PPV/supply chain impact that we’ve been talking about, it’s probably closer to five and six points per quarter. There is logistics charges. We can take it up another quarter two and then we have had a couple of write-offs that we did last year that impacted us. So I just want to frame that the percentage points there, it’s really closer to five or six that are specifically, supply chain, no question that has gotten much, much better from a supply perspective. So we really snapped through this quarter and I was glad to see. I think I actually said in prior calls jeez I’d love to build some inventory, right, because we’ve had to lead business on the table in prior quarters and backlog out of whack. So we’re back to a nice rhythm now. I think from a build perspective there, as you can imagine, there are some prior deals that we had to cut that gets supplied that’s now sitting in inventory. So you won’t see a 100% of the supply chain impact disappear overnight. We obviously have to work that through existing inventory and sell that through, but I would say from an operational perspective, logistics are pretty much back to normal, which is a real-time thing. However you don’t. And then the supply chain thing also back to a really good place. So once we work through any existing inventory that had those higher prices previously will be hitting our stride. So but I think it’s fair to say that we are well past the worst of it. Mark Delaney: Thank you. Operator: Our next question comes from Stephen Gengaro with Stifel. Stephen Gengaro: Good afternoon, gentlemen. One thing for me, I wanted to get your read on NEVI funding, kind of where we stand and what your thought processes on timing, but also, do you have insights into kind of where your customers are in the process as far as trying to secure funding? Pasquale Romano: Sure, Stephen. So just to give you some hard facts around NEVI, there are exactly four states where applications on NEVI proposals are due back within shortly, in general, a little over half the United States has programs that are effectively live where we’re working applications and comments that I’ve made in the past have not changed and that we work across the board with our customer base where the customers are aligned well positionally with position requirements, their location requirements within the NEVI program as well as having the right amenity structure, giving a driver something to do that they would want to do, while they are on a road trip. So combining those two things, we are orchestrating responses to the NEVI program, and sometimes by the way, we’re in multiple applications as the technology provider with different sets of folks from our customer base, that’s generally how we approach it. So think of us as trying to put together this set of optimal sites to meet the state’s requirements by looking into our customer base or potential customer base and trying to orchestrate that. Stephen Gengaro: Okay, great, that’s helpful. So would you expect like an inflection point when the funds are flowing? Or do you think it will be a kind of a more smooth, smooth, just kind of realization of those revenues over time? Pasquale Romano: Yeah, so Stephen, this is what I referred to as an all whoosh no bang industry. If you think about what I just said there, right? It’s all whoosh and no bang. So the timing of all of this stuff, while you will see NEVI starting as we get into 2024 to start to build momentum, right? It’s going to build — it’s going to build along — there’s not going to be a sharp discontinuity where you suddenly going to go vertical on something like that just is this market just doesn’t let you state programs and how state programs are implemented, just doesn’t let you state programs and how state programs are implemented. Just doesn’t let you look at the VW Appendix D programs that contributed to our revenue and it contributed to it in a smoothly increasing way over that program and we would expect NEVI bigger in magnitude to have a similar impact. So I wouldn’t expect some discontinuity out there in the future. The sun and the moon and the stars could align and that could happen just not consistent with history. Operator: We’ll take our next question from Bill Peterson with JPMorgan. Bill Peterson: Yeah, hi, good afternoon and nice to see the gross margin improvement. Just like to clarify in terms of the guidance for this current quarter, it sounds like what you’re saying in some of the trends you saw in the first quarter, are to continue, but just want to make sure still continued relative strength in Europe and fleet, still some I guess discretionary slowdown in commercial and residential. Is that the right way to think about it? Or are there some other areas that are starting to unlock or I guess when does the commercial and residential start to unlock? Is it — I mean we’re kind of past the debt ceiling. What are people, I guess, waiting on at this point from your vantage point? Rex Jackson: Yes, Bill, thanks for the question. First of all, in looking forward to Q2, we did not put parameters around that. But to your point, residential is a function of the sale of cars, right? So keep an eye on how fast EVs move from OEMs into the hands of consumers and that’s a hard one to gauge, but it does look like the OEMs are catching up on their ability to deliver which is great. Commercial is tied to mostly the back to work, although there’s a lot of new construction and other areas where it’s just an imperative because this isn’t a nice to have anymore. This is infrastructure you’ve got to put in. So as the commercial sector — it’s happier and less constrained. Obviously, I think that will be down back to the benefit of our business. Thank goodness in both — in the commercial sector for our existing customers because they keep coming back. So they are a very, very nice underpinning for our existing revenue and what we’re looking at in Q2. And then fleets, you didn’t mention fleet, but fleets, a little harder to predict because it’s — it’s funny on the front end, it tends to be smaller than you would expect. And then on the middle and the back end, it’s bigger than you would expect in terms of per customer. So that could be a little [indiscernible] but Q2 is just a blend of the stuff that we see. I don’t know that it’s going to be meaningfully or wildly inconsistent with the stuff we’ve seen in Q1. Bill Peterson: Yes. Okay. Thanks. That’s a good leading to my second question. So you’ve given some good parameters that you do expect some gross margin, I guess, expansion kind of keep OpEx for any flattish. So that’s really good to back into the two-thirds improvement on the fourth quarter. But I guess, holistically, if we think about third-party forecast, IHS has nearly 60% EV growth in the US this year. I think it has above 60% EV growth in Europe for the calendar year. Your current quarter kind of 40%, 41% year-on-year growth, but is there any reason to think in the back half of the year that at least your network systems, charging systems growth wouldn’t be in that kind of range? Rex Jackson: Well, I wouldn’t put that, frankly, I haven’t thought about it and exactly that those percentage terms. I do think that — the one comment I made in my prepared remarks, to look at the shape of the year and our ability and then saying we think we can cut the adjusted EBITDA loss by approximately two-thirds. It tells you we’re thinking we’re going to have a pretty bad second half, right? So I wouldn’t express in percentage terms, but I would say we’re obviously looking forward to a very strong second half, which is frankly what we’ve done in the last two years in a row. Operator: We’ll take our next question from Alex Potter with Piper Sandler. Alexander Potter: Perfect. Thanks. I had a question, I guess, on customer satisfaction, uptime reliability. I know you’ve done a big focus for the company, those metrics maybe in the past weren’t where you would want them to be. Just interested in knowing maybe what inning you’re in, in terms of addressing that, both, I guess, qualitatively, but also to the extent possible to translate that into P&L impact growth would also be useful and interesting. Thanks. Pasquale Romano: A lot of angles on the answer to that question. First of all, I can’t speak for other charging manufacturers, but we’re very proud of the reliability of our systems and the uptime. We’ve had a variety of different packages for parts and labor warranty programs since the beginning of the company. We’ve encouraged customers to purchase those programs. We have a very high attach rate of those programs, as we’ve commented on that before. All our chargers are connected to our network effectively. So we have good visibility as to general uptime on the network and whether the chargers are in a catastrophic state of failure or not. There are a few mechanical failures we cannot spot, but we have drivers that have a nice little mobile app in their pocket and boy, will they tell us when something is broken. They’re a good canary in a coal mine from a network hygiene perspective. And with that said, we are doubling down now even harder on network hygiene. We are — because of inventory relief, we now can turn around spare parts very, very, very quickly, next business day in most cases. That was not true during the pandemic. There was some delay there because obviously, we were impacted and we had no — we were hand-to-mouth on inventory. So I think that hurt the entire industry in terms of repair cycle delay, that has subsided now. We have completely revamped our support operations across the board, driver support, station-owner support, especially in fleet. We have a lot of new programs in fleet for parts and labor warranty, training of self-maintainers, forward stocking of spares, et cetera. So we think we’re actually in quite good shape with respect to our ability to handle that. We’re not going to get over confident. We’re going to continue to watch it closely. And it is, as you’ve seen in my prepared remarks, multiple times now, it is a big rotation. There was a question earlier that Rex took with respect to operating expense and operating expense focus areas and any focus area changes. And what we’ve consistently said over the last several earnings calls, is that we have lived inside what is a flattish envelope for operating expense, but we are not living inside a flattish operating expense with respect to our efforts on reliability, support operations, et cetera. So we are moving emphasis because we believe that, that is the biggest differentiator you can have right now. Is — it has to be reliable, and we’ve commented also previously the construction of our products are not only from a hardware perspective, looked at from a software point of view inward. So they’re designed for all the features that we think are great, but they’re also designed to be repaired at an incredibly rapid rate and also to be able to support forward stocking of spare parts so that there can be effectively a minimum number of subcomponents we build all our charging infrastructure out of, so it can be very easy to support the repair cycle that will need to support to meet the uptime requirements of most of our customers. So huge investment on our side. Absolutely huge. Operator: Our next question comes from Shreyas Patil with Wolfe Research. Shreyas Patil: Hey, thanks so much for taking my question. You guys have talked about how there is more diversity amongst your verticals as it relates to your revenue. Is there anything to consider in that from a margin perspective? I think in the past, you’ve talked about the workplace charger business being the strongest, fleet was a little weaker due to higher DC fast charging mix. Just curious how we should think about that. Rex Jackson: Yes. So it’s actually more product-specific as opposed to vertical specific but — so single-family home is single-family home, right? And that has a margin. We’ve talked about that. It tends to be healthy, but not as strong as some of the AC products that we put into our commercial and fleet operations. Strongest margins are long-standing AC products, which we’ve recently upgraded to higher power and made some other improvements. But — so where AC goes, you get a better margin and that can be commercial or fleet. And then obviously, we put a lot of effort behind a very robust DC portfolio, which is everything from model that fit in certain applications to what we call our Express Plus, which is modular architecture and the margins on those are getting — are good and getting better. We actually had really good progress because the brand new products and you’ve launched at a lower number than you ultimately expect to do. So I wouldn’t say it’s by vertical, it’s by product because all of our products — our products go into both of the major verticals, commercial and fleet. So I hope that helps you. But it’s — so think of it more from a product perspective. Operator: We’ll take our next question from Brett Castelli with Morningstar. Brett Castelli: Yeah, hi, thank you. Just following up actually on that previous question. Rex, you mentioned the rollout of the new CP6000, I think, on the AC side. Can you just kind of talk about sort of the mix between that new product and the more legacy product that you’re seeing today? And then also, can you touch on any margin differences between the new product versus the legacy? Thank you. Pasquale Romano: I’ll talk about the space that is carved out for itself, so to speak, and Rex can address the margin question in particular. We brought out the 6k not to replace the 4k series. We brought it out as a high-end product. It has a lot of things that obviously roll down over time into lower-cost products, but it’s the flagship currently and it also, for applications, where it’s needed, can provide more power per port and that is not necessary in most medium-duration parking scenarios. So it is not applicable necessarily to every single vertical, although it may have other features that make it applicable to other verticals because it has features across the board that are superior to the 4k product. Without getting into too much detail on the mix because it’s so vertical specific, what I will say is the fleet segment, if it goes with an AC more in a light commercial situation is typically using the 6k or are more lightweight products for light commercial, it is not typically using the 4k product, although we do have some fleet scenarios that use that. So the uptick in fleet, in particular, there’s some correlation there. And the 6k is the primary product we use in Europe. So from the commentary that I made — the primary AC product, I should say, that we use in Europe. So the comments that I made regard to fleet and Europe strength and the corresponding strength in the 6k, those one pulls the other, right? The fleet and the Europe business are more 6k dependent than they are 4k dependent. Rex, I’ll let you take the margin question. Rex Jackson: Yes. So from a margin perspective, the 6k, as Pat said, it’s premium product, higher performance, better features, obviously, we’re evolving the product portfolio in a positive way. It actually has similar margins in North America to the 4k. It’s not all the way there yet but it’s nice to be able to build a next-gen product and to preserve margin on that in the process. And then what’s helping us in Europe, as you may recall, we on the AC side, because of local requirements, et cetera, we’ve had to leverage third-party hardware, and now we don’t have to do that anymore because the 6k is a product that is legal and certifiable and works in both North America and Europe. So that’s been a nice improvement from a margin perspective for us in Europe. Operator: Our next question comes from Itay Michaeli with Citi. Itay Michaeli: Great. Thanks. Good afternoon. Just two quick ones for me. First, I was hoping you could maybe comment roughly on what you’re seeing on utilization of your charges, particularly among commercial customers. And I know not every customer is looking to maximize utilization per se, but curious what you’re seeing there? And second, for Rex, just in terms of the inventory build in Q1, maybe how should we think about working capital at a high level the rest of the year? Pasquale Romano: Two very different questions. I’ll take the first, Rex, you take the second. In terms of utilization, our sales team obviously is — sees utilization data as to our customers. It’s a standard reporting feature in our network. And the utilization has to be measured in the context of the hours of operation at the site. I’ll give you — so it’s hard to comment on utilization in the network as a whole and have that be meaningful because in any subvertical, the utilization is measured differently because it’s measured during hours. And the easiest example to give you is a stadium. We have a lot of stadium customers. The stadium is only active when there’s an event at that stadium. Measured on a utilization basis over a 24-hour, on a 365-day year basis, stadiums have horrible utilization unless there’s an event and then they’re 100% booked. So it all goes down to how you measure it. And utilization is very, very strong across the board. And if you want to see the best proxy for that, look at comments that we’ve made in the past about the rebuy rates. The rebuy rate tends to be the majority of the revenue within a quarter because as Rex mentioned in an answer to one of his questions, the initial buy is smaller than you think it should be and the follow-on buys are bigger than you expect them to be. And that’s because the customers start out with some experimentation, especially in the commercial segment where it’s more discretionary. And then they see the utilization and let that drive the expansion. So because the rebuy rate is so strong, it’s the best proxy you guys can use for, is the utilization on the network? Is it strong and is it growing? Rex Jackson: Yes, and very quickly on the inventory working capital question. No question in Q1, our inventory popped up almost $50 million. In truth, that’s actually a blessing not a curse because we went from a lot of long lead time items and a lot of stuff in raw materials to being able to kick things up and get some bills and we have low obsolescence risk on these products. So getting through that and having a blend to inventory of good finished goods that we can move and therefore, we have pretty back-end loaded quarters like most companies. And so knowing that you can ship, what you need to ship at the end of the quarter to meet demand is a really good thing. So I think the inventory will come down meaningfully on a percentage basis relative to revenue. If you look at like the size of the company, the question is bigger than it needed to be in Q1, but those the reasons because we’re coming out of the supply chain issue. And then working capital generally, we bring in inventory down relative to that, that will help as the company grows. And so I actually think that, that part of the picture will definitely improve later this year. Operator: We’ll take our next question from Joseph Osha with Guggenheim Partners. Joseph Osha: Hi, thanks. I just have one question. We talked a little bit about NEVI earlier. I’m wondering, given the timetable and the ambition of the CARB Advanced Clean Fleets rule, what your thoughts are about how that might begin to layer into your business? Thanks. Pasquale Romano: I mean you saw the strength in the fleet business. And so also the fleet business is one of — is interesting. California obviously usually leads the way in the United States with respect to innovation and policy and incentives. But because it’s just good for business to electrify your fleet from a cost structure perspective, we’re seeing a fleet business that’s pretty pervasive across Europe and the United States and not necessarily hotspoted just in California. And like any program, and this is very in line with the comments on NEVI, it doesn’t hit you all at once, it tends to build. So it will contribute. It will contribute over time because it will drive vehicle electrification but again, I don’t expect it to drive, it just can’t move. And remember, you need the vehicles to be able to have demand for the charging infrastructure and that’s the biggest variable there. You can have the incentive structure there, but it doesn’t necessarily mean that the vehicles are going to follow in perfect order. Operator: Thank you, everyone. This concludes today’s presentation. We appreciate your participation, and you may now disconnect. Follow Chargepoint Holdings Inc. (NASDAQ:CHPT) Follow Chargepoint Holdings Inc. (NASDAQ:CHPT) We may use your email to send marketing emails about our services. Click here to read our privacy policy......»»

Category: topSource: insidermonkeyJun 6th, 2023

There are 2 big reasons why the chances of a recession in the next year have dropped, according to Goldman Sachs

Goldman Sachs said stabilization in the housing market gives it confidence that the US will see GDP growth of 1.8% in 2023. Construction workers build the $1.05 billion Brickell CityCentre condo/retail mix use complex on July 7, 2014 in Miami, Florida. Condo projects are booming in the South Florida area as foreign investors pour money into the new residences being built.Joe Raedle/GettyThe chances of a recession hitting the US economy within the next 12 months have dropped, according to Goldman Sachs.The bank lowered its odds of a recession hitting the US economy to 25% from 35% in a Tuesday note.These are the two big reasons Goldman Sachs feels more confident about the economic outlook.A recession hitting the US economy within the next 12 months appears less likely today than it did just a couple weeks ago, according to Goldman Sachs.The bank's top economist Jan Hatzius lowered the chances of a recession to 25% from 35% in a note on Tuesday. That call goes against a lot of the warnings CEOs and market strategists have issued over the past few months, as many were expecting a recession to happen by the middle of this year.But ongoing strength in the labor market and solid consumer spending have highlighted the fact that the US economy is a lot more resilient than many think.Hatzius offered two other reasons why he sees lower odds of a recession, according to the note.1. A debt ceiling deal has been reached. A bipartisan debt ceiling bill cleared Congress last week, with President Joe Biden signing the legislation over the weekend. It suspends the debt limit until 2025, essentially removing the possibility of a default happening any time soon."The tail risk of a disruptive debt ceiling fight has disappeared," Hatzius said. "The bipartisan budget agreement to suspend the debt limit will result in only small spending cuts that should leave the overall fiscal impulse broadly neutral in the next two years."Such a default likely would've been catastrophic for the US economy and stock market, with the White House estimating that a full-blown default would eliminate 8 million jobs and result in a 45% decline in stocks.2. The regional banking crisis is over."We have become more confident in our baseline estimate that the banking stress will subtract only a modest 0.4 percentage point from real GDP growth this year, as regional bank stock prices have stabilized, deposit outflows have slowed, lending volumes have held up, and lending surveys point to only limited tightening ahead," Hatzius said.Those two reasons, combined with the economy getting "a sizable boost" from the stabilization in the housing market and growth in real disposable income give Hatzius confidence in Goldman Sachs' 2023 US economy growth forecast of 1.8%, which is well above consensus.Read the original article on Business Insider.....»»

Category: smallbizSource: nytJun 6th, 2023

Airbus has unveiled the aircraft cabin of the future. Take a look at Airspace Cabin Vision 2035+.

Airbus' vision for more sustainable aircraft cabins includes lighter, recyclable materials, new catering concepts, and a focus on transparency. The cabin can contribute between 10-20% to the aircraft’s overall environmental impact during its lifecycle, according to Airbus.Courtesy of Airbus Airbus has unveiled its Airspace Cabin Vision 2035+ in a May 30 presentation.  The plane maker is relying on a circular economy to make its new cabins lighter and less wasteful.  In the future, Airbus hopes to integrate the new cabins in its developing hydrogen-powered aircraft. Airbus has unveiled its vision for a more sustainable aircraft cabin, as airlines labor to reduce their emissions, hoping to fully decarbonize aviation by 2050. The cabin contributes to up to 20% of an aircraft's environmental impact during its lifecycle, according to a May 30 presentation. The largest plane maker in the world wants to tackle that by reducing cabin weight, using lighter materials and designs, and getting rid of waste by encouraging recycling and getting passengers to pre-order meals. In the future, Airbus hopes to integrate the new cabins in its hydrogen-powered planes. Take a look at Airspace Cabin Vision 2035+:Airspace Cabin Vision 2035+ is Airbus' concept for the future of its aircraft cabins.Courtesy of AirbusDecarbonization and circularity are at the core of the vision.Courtesy of AirbusPart of the plan is to use lighter materials and designs...Courtesy of Airbus...that could reduce the cabin's weight by up to 40%.Courtesy of AirbusThe new materials would be easier to be recycled, reused, and repaired during the aircraft's lifecycle.Courtesy of AirbusPassengers could access information about the materials through QR codes.Courtesy of AirbusBy 2025, Airbus wants to provide transparency on the environmental impact of cabin parts and operations.Courtesy of AirbusAnd by 2030, Airbus wants to introduce new, more sustainable designs and materials.Courtesy of AirbusThe cabins would function according to the concept of circular economy.Courtesy of AirbusCircular economy is an economic system built on the reuse of materials or products.Courtesy of AirbusWater used in the bathroom sink, for example, would be reused to flush the toilets.Courtesy of AirbusAirbus hopes to have cabins based on a fully developed circular economy starting in 2035.Courtesy of AirbusThe company also envisions new catering options.Courtesy of AirbusOn long-haul flights, passengers would pre-order meals.Courtesy of AirbusOn short-haul flights, they would pick up their snacks at the gate...Courtesy of Airbus...before boarding.Courtesy of AirbusThis could reduce food waste and weight by up to 15%.Courtesy of AirbusThe whole experience, from boarding to accessing information about the cabin's components, relies on digitization.Courtesy of AirbusIn the future, Airbus hopes to integrate the new cabins in the hydrogen-powered aircraft it's developing.Courtesy of AirbusAirbus is working on three hydrogen planes and plans to mature all the required hydrogen technologies by 2025.Courtesy of AirbusThe hydrogen-powered aircraft could enter commercial operations in 2035.Courtesy of AirbusRead the original article on Business Insider.....»»

Category: topSource: businessinsiderJun 6th, 2023

The mother-daughter duo behind the thrift store Buffalo Exchange explains how they built a $103 million company from used clothes

The secondhand market is expected to double in size, reaching $77 billion by 2025, but Buffalo Exchange is already ahead of the trend. Buffalo Exchange is a popular resale chain where fashion lovers can trade their gently worn clothing for cash or store credit.Buffalo Exchange; Samantha Lee/Insider Kerstin and Spencer Block founded the resale chain Buffalo Exchange in 1974. The company has 41 stores nationwide and booked $103 million in revenue in 2022. Kerstin and her daughter, Rebecca, run Buffalo Exchange today. They explained the company's success. In the 1970s, thrift shopping was far from the favored Gen Z weekend activity that it is today. Back then, secondhand clothing carried a stigma as a lower-class necessity, said Kerstin Block, the president and co-owner of Buffalo Exchange."Resale was not popular then," she said. "We have worked to change that perception over the years." And they did: Her company grew from one family-run store in 1974 to a chain of 41 family-owned and -operated stores across the US. In 2022, Buffalo Exchange's revenue hit $103 million, which Insider verified with documentation. A spokesperson declined to share current figures as the company at the time was still recovering from closing its stores for three months during the pandemic. Decades of youth culture have made the secondhand market what it is today — an appreciation of vintage clothing and a more environmentally conscious way of shopping. Searches for "second-hand shop" on Google have spiked.The industry is expected to double in size, reaching $350 billion by 2027, and Buffalo Exchange is at the forefront of resale's emerging appeal. The founders achieved lasting success by drawing on their strengths and popularizing a unique business model."The resale industry as a whole has just gotten bigger, so there's room for more people in it, which helps everybody inside the industry," said Kerstin's daughter, Rebecca Block, who grew up working in the store from age 9 and is now the company's vice president.The mother-daughter-duo detailed three keys to the brand's success.A version of this story appeared on August 31, 2021.Popularizing the 'buy, sell, trade' modelKerstin (left) and Spencer Block in their first resale store in Tucson, Arizona.Buffalo ExchangeKerstin and her late husband, Spencer, opened their first store in Tucson, Arizona, in 1974. It wasn't truly a thrift store because it didn't accept donations, but it wasn't a consignment store either. The couple had a business model called "buy, sell, trade," which paid customers cash or store credit for the finer items in their closets. While they didn't invent the "buy, sell, trade" model, it wasn't as common then, said Jennifer Le Zotte, an assistant history professor at the University of North Carolina and the author of "From Goodwill to Grunge: A History of Secondhand Styles and Alternative Economies."It also helped that fashion cycles have accelerated since the early '90s. Garment manufacturing that used to take months now take weeks, so people turned to resale as a way to freshen up their closets instead of repeating outfits. "People are expected to have a bigger wardrobe and to recycle outfits less in their social life," Le Zotte said.Today the "buy, sell, trade" model is widely used in resale, from local stores such as Beacon's Closet in New York to national chains such as Plato's Closet.The right people doing the right thingsKerstin Block (left) is the president and co-owner of Buffalo Exchange. Her daughter (right), Rebecca Block, is the vice president.Buffalo ExchangeSpencer wrote a book about the family's business that was published after his death. Among the many lessons he described was that Buffalo Exchange's success was not merely luck or good timing, but based on two people drawing on their strengths. "There are so many people who start businesses without the right combination of love and skills and then blame their failures on luck," he wrote. "Luck is not a critical element of success in small business."Kerstin was the artistic one who handled the fashion and marketing. As a former decorator for a furniture retailer, she had an eye for what people wanted. Meanwhile, Spencer took care of the business operations, including bookkeeping and advertising. They stuck to what they were good at and didn't attempt to fill the other's role.An innate ability to know what sellsInside Buffalo Exchange's Ventura, California, store.Buffalo ExchangeIn the same way Kerstin and Spencer built their business through their unique skills, the company looks for employees with a special knowledge of fashion. "Usually people have a niche and an interest," Kerstin said. "They might be sneakerheads. They might have a real love of vintage." When customers walk into Buffalo Exchange with a tote bag full of clothing, store associates known as buyers are the ones who sort every piece to find the gems. They check for brand names, garment condition, and overall appeal to stock the store with items from brands like Levi's, Free People, and Nike. You can find gently used luxury goods like leather jackets and designer bags for a fraction of their original prices."We call it an art, not a science, because it really does take this innate interest in it," Rebecca said. And the stores are known for this careful method of curating only the clothing and accessories that shoppers will find cute, unique, or trendy. You won't see piles or bins of indistinguishable clothing or racks of tangled dresses. "It really is the fun part of the job — being in the store and helping customers," Rebecca said. She added that employees "get a lot out of helping the customers, and the customers have a really great time."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJun 5th, 2023

Rio Tinto (RIO) to Invest $395M in Water Desalination Plant

Rio Tinto (RIO) plans to invest in a desalination plant in Pilbara that will supply water to the company in future. Rio Tinto RIO announced intentions to invest $395 million in a saltwater desalination plant in the Pilbara region of Western Australia. This project will use reverse osmosis to filter salt and other impurities from ocean water and provide a future water supply for RIO's coastal operations and local communities in 2026.The project is subject to Commonwealth and State Government and other relevant approvals. The plant’s construction is projected to start in 2024 and is anticipated to be operational and generate water in 2026. Rio Tinto intends to create roughly 300 jobs during the plant's peak construction period.The plant will be built within the company's existing iron ore port operations at Parker Point. Water from the plant will be transferred to the West Pilbara Water Supply Scheme, which is owned and operated by the Water Corporation. From there, it will be distributed to Rio Tinto’s coastal communities and operations. The company will also build a new supply pipeline that will connect the plant to the existing water network.In order to avoid disruption to the local environment, RIO will make use of Parker Point facilities’ existing infrastructure. It will use reverse osmosis to remove salt and other contaminants from ocean water.The plant's nominal capacity will be four gigaliters per year at first, with a scope of an increase to eight gigaliters in future.This investment of $395 million is part of the company’s sustaining capital expenditure budget for the fiscal  year. Rio Tinto maintains its capital expenditure guidance at $9 billion to $10 billion for fiscal 2024 and 2025.Price PerformanceIn the past year, shares of Rio Tinto have lost 19.5% compared with the industry’s 26.2% decline.Image Source: Zacks Investment ResearchZacks Rank & Stocks to ConsiderRio Tinto currently carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the basic materials space are AngloGold Ashanti AU, Gold Fields Limited GFI and Alamos Gold Inc. AGI. AU and GFI currently sport a Zacks Rank #1 (Strong Buy) while AGI carries the same rank  as FSM. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for AngloGold Ashanti’s earnings per share is pegged at $1.94 for 2023. Earnings estimates have been revised 22% upward in the past 60 days. The company has gained 36.1% in a year.The consensus estimate for Gold Fields’ fiscal 2023 earnings per share is pegged at $1.01. Earnings estimates have moved 6.3% north in the past 60 days. Its shares have gained 56% in the past year.The Zacks Consensus Estimate for Alamos Gold’s earnings per share is pegged at 47 cents for 2023. Earnings estimates have been revised 14.6% upward in the past 60 days. AGI has gained 49.5% in a year. Zacks Reveals ChatGPT "Sleeper" Stock One little-known company is at the heart of an especially brilliant Artificial Intelligence sector. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion. As a service to readers, Zacks is providing a bonus report that names and explains this explosive growth stock and 4 other "must buys." Plus more.Download Free ChatGPT Stock Report Right Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Rio Tinto PLC (RIO): Free Stock Analysis Report AngloGold Ashanti Limited (AU): Free Stock Analysis Report Gold Fields Limited (GFI): Free Stock Analysis Report Alamos Gold Inc. (AGI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research.....»»

Category: topSource: zacksJun 2nd, 2023